Move out of a home you’ve lived in and rent it out, and the capital gains tax (CGT) main residence exemption doesn’t necessarily end the day you leave. Under the ATO’s “six-year rule,” you can keep treating that former home as your main residence for CGT purposes for up to six years while it’s producing rental income — which means the exemption can still apply if you sell within that window, even though the property earned you rent while you were away. The rule comes with real conditions: a time limit, a restriction on claiming any other property as your main residence at the same time, and a different result if you go past it. Here’s how each piece works.

What is the six-year rule for a main residence?

A property only qualifies for this treatment once it has genuinely been your main residence — the home you and your family lived in. From that point, moving out doesn’t automatically end the CGT exemption. Under the ATO’s guidance on treating a former home as your main residence, a former home can still be treated as your main residence for up to six years at a time while it’s income-producing — meaning it’s rented out or otherwise used to earn income.

If you move out and don’t rent the property at all — you leave it vacant, or a family member stays there rent-free — there’s no six-year cap. The ATO treats it as your main residence for an indefinite period in that case, because it isn’t producing income.

Both versions of the rule apply per absence, not once in a lifetime. If you move back into the home at some point and later move out again, a fresh period starts for that next absence.

What conditions apply?

Two conditions sit alongside the time limit.

The home has to have been your genuine main residence first. The ATO’s eligibility rules for the main residence exemption set out what that means in general: the dwelling has been the home of you (and your partner or dependants), it hasn’t been used to produce income for the period the full exemption covers, and it sits on land of 2 hectares or less. The six-year rule extends an existing main residence status during an absence — it doesn’t create one.

You generally can’t treat another property as your main residence for the same period. Beyond a 6-month overlap allowed when you’re moving from one home to another, only one property can be your main residence at a time. If you buy a second home and start treating it as your main residence while the six-year clock is still running on the first, that generally ends the six-year treatment on the original property.

What happens if you rent it out for longer than six years?

Once the six-year limit is exceeded, the property’s cost base is generally reset to its market value on the day it first became income-producing — the ATO’s home first used to produce income rule. From that day, you’re treated as if you’d acquired the property then, at that market value, rather than on your original purchase date.

The eventual capital gain or loss is then split between an exempt slice and a taxable slice using a set formula in the tax law (section 118-185):

CG or CL amount × (Non-main residence days ÷ Days in your ownership period)

“CG or CL amount” is the capital gain or loss you’d have made without this rule. “Non-main residence days” counts only the days after the six-year cap expired — the first six years of an absence still count as main-residence days under the choice described above (section 118-145). “Days in your ownership period,” for this formula, runs the full span from the day you’re deemed to have acquired the property (the day it first produced income) through to disposal — not from when you originally bought it.

An ATO worked example confirms this. An apartment first rented out from a set date, after the owner had lived in it for years beforehand, was eventually sold roughly 25 years later. The ownership-period denominator ran the full 9,133 days from that first-rented date to the sale — not from the original purchase date — while the non-main-residence numerator counted only the 6,940 days after the six-year cap expired. The resulting gain was then reduced by the 50% CGT discount before tax.

If part of the home was also used to produce income while it was still your main residence — before you moved out — a further adjustment can apply on top of this formula (section 118-190). That combination, and whether making the six-year-rule choice suits your situation at all, are calculations for a registered tax agent working from your actual dates and figures, not something a general guide can resolve.

The portion of the gain that ends up taxable isn’t necessarily taxed in full, either. If you’re an Australian resident individual and you’ve held the property for at least 12 months (excluding the day you acquired it and the day of the CGT event), the ATO’s CGT discount reduces that taxable gain by 50% — as at July 2026, for CGT events before 1 July 2027. Under the changes enacted in June 2026, this discount ends for most individuals, trusts and partnerships for CGT events on or after that date.

Tax outcomes depend on your circumstances — speak with a registered tax agent before acting.

It’s worth getting a market valuation done at the point the home first starts producing income, because that valuation becomes the new cost base if you later exceed the six-year limit. The ATO’s record-keeping rules for property CGT require records to be kept for the whole period you own the property, plus at least 5 years after you dispose of it — a valuation obtained years after the fact is much harder to substantiate than one obtained at the time.

What’s the outcome for each six-year rule situation?

Situation	Main residence treatment
Rented out, sold within 6 years of moving out	May still be fully exempt
Left vacant, not rented, after moving out	Exempt indefinitely
Rented out beyond 6 years	Cost base resets; gain apportioned by day
Another property claimed as main residence meanwhile	Six-year treatment generally ends
Moved back in, later moved out again	A fresh six-year period starts

Does selling Brix in your home change any of this?

Not in the way you might expect — because a Brix isn’t the same kind of asset as the home itself. Each MyBrix property is divided into 10,000 Brix representing the property’s economic benefits; a Brix is a financial product under the Corporations Act, not a transfer of legal or beneficial ownership of the property. The owner remains the registered legal owner throughout, and selling Brix doesn’t affect occupancy rights — you can keep living in the home, or move out and rent it, exactly as you otherwise would.

That said, the ATO’s main residence rules — including the six-year rule above — are built around disposing of your ownership interest in a dwelling; for a co-owner, for example, the exemption applies proportionally to their legal ownership share. Selling an economic interest while retaining full legal title and continuing to live in the home is a different arrangement, and no ATO guidance currently addresses how the main residence exemption applies to that specific case. This draft does not assert that proceeds from selling Brix in your own home are exempt from CGT, and it does not assert that they’re taxable — that question isn’t resolved in published guidance either way.

Tax outcomes depend on your circumstances — speak with a registered tax agent before acting. The MyBrix Product Disclosure Statement and Target Market Determination, available at mybrix.com.au, set out how Brix work in detail.

For the full mechanics behind a property CGT calculation — cost base, the discount, and what changes in 2027 — see our guide to what capital gains tax is and how it’s calculated.