Required: Discuss the CGT consequences of Marnie selling her rental property (citing authority where appropriate). You are not required to discuss the application of the 50% CGT discount, or the impact of Division 43 of the ITAA 1997 (4 marks).

Marnie bought a rental property in 2012. The details are as follows (note that the house was rented out for the full time she owned it):

• Upon purchasing the house in 2012, Marnie gave the seller $600,000 cash and $50,000 in CBA shares as consideration for the purchase. Marnie also agreed to take over the $100,000 mortgage that the seller had.
• In 2016 the house needed repainting due to the wear and tear that occurred since Marnie purchased the house. Marnie paid someone to have it repainted at a cost of $10,000.
• In 2017 Marnie renovated the bathroom of the house. This cost $5,000 in materials. To save labour, Marnie did the renovation work herself she estimated that had she hired a trades person instead of doing the work herself, the labour would have cost approximately $15,000.
• Marnie sold the house in February 2023 in exchange for the buyer giving her $1.2 million. The buyer sued her a month later because the sales contract stated that the house had no asbestos, but it ended up having some. This case was settled by Marnie giving the buyer $100,000 for the breach of contract.