I recently inherited my mother's house and I have my own house with a mortgage. How long do I have to keep my mother's house before capital gains tax applies? Do I have to live in the house for a period of time in order to avoid paying CGT?

You have two years from date of death to sell the property CGT-free; you don't have to live in it and you can rent it out during that time if you wish. However, once the two years have passed, you will be liable for CGT on any increase in value from the date of your mother's death.

I run a small business from home. I do the outdoor work, my wife handles the administration and my daughter handles the accounts. We have a self-managed super fund where all three are members. My wife and daughter both draw salaries in the range of $30,000 a year. If we deposit at least $1000 each for my wife and daughter, would they be eligible for the super co-contribution of $1500?

Based on the information supplied, they should both be eligible for the co-contribution but their total income would have to be no more than $28,980 to qualify for the whole $1500.

We would like to invest a few thousand dollars long term, with interest going to a trust account for our grandchildren but still owning the principal and with no taxation implications for ourselves.

The best way is to invest the money in insurance bonds in your own name. As the earnings accrue in the form of bonuses, there is nothing to include in your tax return each year and when 10 years or more have passed, you can cash in the bond tax-free, make a gift of the earnings to your grandchildren and keep the original principal. If you are receiving any age pension benefits, you would need to seek advice because the bond will be subject to deeming and any gifts in excess of $10,000 in a financial year may be treated as a deprived asset.

I am 65 and have a small business, operating as a sole trader. I want to retire permanently but may want to start up a similar business a little later. Can I withdraw my super tax-free, then start another business and contribute again for a few years before retiring permanently again? How does the Tax Office guard against the possibility of people like me using this device as a means of having access to super early?

Once you reach 65, you can access your super without restriction and until you reach age 75, you can make super contributions as long as they are within the allowable limits. You will not be getting your super early as 65 is regarded as a reasonable retirement age and it is government policy to allow older people access to their super and continue working as an encouragement to remain in the workforce.

I'm 52 and my husband is 55. We earn a combined income of $84,000 a year. We have a mortgage of $186,000 and super of about $80,000. We have $200 a week to invest. Is it better to pay $200 off the mortgage (interest rate 9.41 per cent) or just pay interest on the mortgage and pay $200 into super? We hope to retire in 10 years' time.

At your age it's always best to use salary sacrifice and in your tax bracket, $200 a week in after-tax dollars is equivalent to $292 a week in pre-tax dollars. I suggest the higher income earner salary sacrifice an additional $292 a week to super, which will provide $248 in super after the 15 per cent contributions tax has been deducted. At the appropriate time, withdraw the surplus money from super to pay off your mortgage.

This article is general in nature. Readers should seek further advice before making financial decisions.

To ask a question write to Ask Noel, Money, GPO Box 2571, Qld 4000, or visit moneymanager.smh.com.au/sitewide /askanexpert.html.