Claiming interest on block of land

I know I can claim interest charged on a loan to purchase land on which to build a rental property. Is there a time limit? If I owned the land for 4 years, then built an investment house, could I then claim all the interest on the loan from the date of purchase 4 years ago? The ATO website doesn't appear to stipulate a time limit.
 
You would most likely need to claim the interest in the year it was incurred and amend the previous tax returns. I think you can do so for up to 4 years, so you may in just in time.
 
You would most likely need to claim the interest in the year it was incurred and amend the previous tax returns. I think you can do so for up to 4 years, so you may in just in time.

From the ATO publications I don't see any limit with regards to the number of years. There is no mention about 4 years. The text clearly states that the interest paid on a loan taken out to purchase an empty land with the intention to build an investment property is tax deductible. So it has to be claimed in the same year. But if the intention changes then from that time onwards the interest amount cannot be claimed. This is what I read from the ATO site and publications.
 
I know I can claim interest charged on a loan to purchase land on which to build a rental property. Is there a time limit? If I owned the land for 4 years, then built an investment house, could I then claim all the interest on the loan from the date of purchase 4 years ago? The ATO website doesn't appear to stipulate a time limit.

There is no time limit on the process to build.

You must show that at all times you are in the process of acquiring a property for rental (not just building a residence that might become a rental).

The onus is on you to show that intention has not changed.

Therefore delays which are due to your inaction will destroy your arguments.

I have to say that the ATO website appears quite lenient to the point of being misleading given that it is information for unsophisticated taxpayers. However, it is still a quite general overview.

The case law referred to analysed in great detail the actual activities at all times to decide if there was an income producing activity present.

Just remember, the ATO enforcement policy has changed massively in the past 3 years. It truly is happy days for tax litigation lawyers !!

Cheers,

Rob
 
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