Supporting older Australians - exempting granny flat arrangements from Capital Gains Tax (CGT)
The submission to the Department of Treasury in response to the consultation on the exposure draft of the Treasury Laws Amendment (Measures for Consultation) Bill 2021: Exempting granny flat arrangements from CGT (the Bill), and its explanatory materials was prepared by the Law Council of Australia.
The Bill amends the CGT provisions in the Income Tax Assessment Act 1997 (Cth) (ITAA97) to provide a targeted CGT exemption in relation to granny flat arrangements (GFAs).
Against the backdrop of Australia’s ageing population, and the focus on the inadequacies of aged care as highlighted by the Royal Commission into Aged Care Quality and Safety and the COVID-19 pandemic, GFAs are becoming increasingly common.
The Law Council therefore welcomes the measure proposed by the Bill ‘to encourage the formalisation of granny flat arrangements to support the stable and long-term housing arrangements of older people and people with disabilities, and to reduce the risk of financial abuse or exploitation.’
You can read the full submission below.