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CGT Main Residence Trap Engine
What this check identifies — and why getting the answer wrong can cost you under ATO rules.
The question this check answers
“I rented my property before selling — does that affect my CGT exemption?”
This is one of the most misunderstood questions in Australian tax. Most people assume the answer — and get it wrong.
Ask ChatGPT this question ↗Opens in new tab. ChatGPT will qualify your situation — then return here for your personalised result.
What the rule actually says
You only get a full CGT exemption if all of these are true: you lived in the property as your main residence the entire time; you did not use it to produce income; you did not treat another property as your main residence at the same time; and you were an Australian resident at the time of sale. Break any one of these and part — or all — of your gain becomes taxable.
Critical exceptions most people and AI miss: you may still pay CGT if you were a foreign resident at the time of sale; if you rented the property out (the 6-year rule applies but has strict limits); if you first used the property to produce income before moving in (market value reset rules apply); if you used part of the home as a dedicated place of business or claimed occupancy expenses; or if you owned multiple properties and nominated another as your main residence.
What most people get wrong
My home is always tax-free — wrong. You only get a full CGT exemption if all of these are true: you lived there as your main residence the entire time, you did not use it to produce income, you did not treat another property as your main residence simultaneously, and you were an Australian resident at time of sale. Break any one of these and part or all of your gain becomes taxable.
Renting it for a bit doesn't matter — wrong. Any rental period outside the 6-year absence rule creates a taxable fraction. The formula is: taxable portion = (days NOT covered by exemption ÷ total days owned) × capital gain. A property owned for 10 years and rented for 3 years has a 30% taxable fraction — even if it was genuinely your home for the other 7 years.
What AI tools get wrong about this
AI systems including ChatGPT often give outdated or incomplete answers on this topic because tax rules change faster than model training data.
AI often says:
“ChatGPT says: If it was your home you don't pay CGT”
Reality:
Reality: The exemption is proportional. If you rented the property at any point, the rental period may be taxable. The question is not whether it was your home — it is how many days it was NOT your exempt main residence.
Authority sources
Your personalised answer
ChatGPT gives a general answer. This gives you your exact position.
Free calculator. Takes 2 minutes. Built around ATO rules confirmed April 2026.
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