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1. Principal Residence Exemption

• Most countries allow for a principal residence exemption, which means no CGT is payable for the time the property was your primary residence.
• For the 10% of the property used for business: This portion is usually excluded from the exemption, meaning CGT might apply on this portion when the property is sold. The exact rules depend on how the business use was treated for tax purposes (e.g., whether deductions were claimed for expenses like mortgage interest, utilities, or depreciation).

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2. Time as Investment Property

When you moved out in 2020 and began renting the property, the property’s cost base for CGT purposes resets to its market value at the time it becomes an investment property. This means:

• The starting value for calculating CGT becomes $450k (the property’s value in 2020).
• Any gain or loss after 2020 will be calculated based on the difference between the eventual sale price and this adjusted cost base.

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3. 10% Business Use While Living in the Home

While living in the home, CGT would generally apply to the 10% portion of the property used for business. However, if the property’s value declined during this period (from $500k to $450k), there would be no capital gain for this time, so no CGT is payable for that period.

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4. Business Use After Moving Out

For the time the property was rented out:

• CGT implications for the 10% business use would depend on whether you continued to claim it as a business asset during this period.
• If it was no longer used for business after moving out, then CGT may not apply for the post-2020 period.

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Key Points for Your Scenario

1. Decline in Value: Since the value of the property declined during your ownership, there may not be a CGT liability for the 10% business portion while you lived there.

2. Reset Cost Base in 2020: The cost base for CGT purposes is $450k as of 2020, so any calculation of gain or loss will use this figure going forward.

3. Post-Moving Business Use: If the 10% of the property was not used for business after you moved out, you may not owe CGT on this portion for the rental period.

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Next Steps

• Consult a Tax Professional: CGT rules are highly country-specific, and a tax professional can provide tailored advice.
• Documentation: Keep detailed records of:
  • Purchase price ($500k in 2010).
  • Market value in 2020 ($450k when it became a rental).
  • Sale price and date (if applicable).
  • Business use details (e.g., floor plans or tax deductions claimed).