I had a client recently who was selling this main residence. He was shocked when I told him it would not be fully CGT exempt as it was about 8 acres in size.
The main residence CGT only applies to a dwelling on land of up to 2 hectares in size. So when the land is larger than 2 hectares only part of the property will qualify for the main residence exemption.
See s118-120(3) ITAA97.
Note that the 2 hectares can be selected on the most valuable parts of the land which need to be adjacent to each other. For example you might have the land under the house on one side and the land under a shed way down the back, but not count the land in between them.
See TD 1999/67
Which includes this diagram:
Written by Terryw tax lawyer at www.structuringlawyers.com.au