Asset Transfers on Death and CGT Realisation: Estate Planning Considerations for Investment Properties

Summary

Property investors discussing estate planning often express concern over potential tax liabilities when transferring real estate assets upon death. Under current Australian tax law, inheriting an investment property generally triggers CGT rollover relief, meaning CGT is deferred until the beneficiary eventually sells the property. However, beneficiaries inherit the deceased's original cost base, which can create significant tax obligations upon future disposal. Landlords should consult qualified tax accountants to structure asset ownership appropriately and maintain adequate estate liquidity.

Key Points

Why it matters: Encourages property owners to understand statutory Capital Gains Tax rules governing inherited real estate, preventing unexpected tax liabilities and forced property liquidations during estate settlements.

Property investors discussing estate planning often express concern over potential tax liabilities when transferring real estate assets upon death. Under current Australian tax law, inheriting an investment property generally triggers CGT rollover relief, meaning CGT is deferred until the beneficiary eventually sells the property. However, beneficiaries inherit the deceased's original cost base, which can create significant tax obligations upon future disposal. Landlords should consult qualified tax accountants to structure asset ownership appropriately and maintain adequate estate liquidity.

Practical Takeaway

Use this note as a practical prompt before making decisions. Check the rules in your state, keep written records, and seek qualified advice where needed.