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A passive investment isn't an active asset for small business concessions. The accounts can say whatever they like. Tax law treats the asset as trading stock when k4 occurs. I saw an accountant treat a developer property (land) as a CGT asset and the build cost as trading stock in the accounts...

No. It said the intent was to acquire it to sell for a profit. How the accounting treated it has nothing to do with intent. The accounting treatment could have called it furniture, fixtures and fittings. Doesn't matter.

WIP is the other name given to trading stock. Its the accumulated "cost" of the site, build etc. Its a balance sheet item that also affects P&L. That's the accounting view. In this situation the AAT agreed with ATO that at the time the enterprise commenced there was an intent to acquire land...

Fern - That doesn't sound like developer intentions. Its seems like a decision to rebuild and earn income. The key issue intent to sell and profit from that.

A recent case before the Administrative Appeals Tribunal (WWXY v FCT [2015] AATA 130) raises a matter that anyone who proposes to develop land should consider. In the WWXY case a proposed JV development was planned. The Trust owned two adjoining lots acquired to develop with a neighbouring...