Claiming stamp duty versus paying CGT...

Hi guys,

I have an issue that I’m trying to get my head around.

I’m purchasing a property in the ACT.

The intention is to make it an IP for the first 6 – 12 months and then move into it.

I’m doing this so I can claim the entire amount of stamp duty at the end of the 2009-10 financial year – it will put another $5k in my pocket (which I could really do with right now!)

So on to my question.

Is it true that if I rent the property out from the day we purchase it I will never be able to claim it as my PPOR? (Because the intention, in the ATO’s eyes, is that it was purchased as an investment property).

And therefore, would I be relinquishing the CGT exemption that would normally be granted to a PPOR in the event that we decide to sell in the distant future? (I’m assuming I would).

I wouldn’t want to gain $5k now at the expense of paying an exorbitant amount of CGT down the track.

Cheers,

Pretzel
 
Sorry guys, I’ve made this question more complicated than it needs to be.

1. If I purchase a property and make it an IP from the start.

2. Then move into it after 6 months.

3. Live in it for the next 10 years and then sell it.

4. Will it be CGT exempt?
 
It will be CGT exempt from the poin that you move into it, so any CG seen in the firts 6mths will incurr CGT - but from the point you move in, there will be no CGT.

:)
 
Hi guys,
I’m doing this so I can claim the entire amount of stamp duty at the end of the 2009-10 financial year – it will put another $5k in my pocket (which I could really do with right now!)

Could you please elaborate on this? As far as I am aware you can't "claim" stamp duty as a tax deduction (the interest on a loan to pay it perhaps - but not the stamp duty itself). Is this something I am not aware of (very possible) or is there some other confusion?

Regards,

Jason
 
Could you please elaborate on this? As far as I am aware you can't "claim" stamp duty as a tax deduction (the interest on a loan to pay it perhaps - but not the stamp duty itself). Is this something I am not aware of (very possible) or is there some other confusion?

Regards,

Jason

Stamp duty is a claimable deduction for properties purchased in the ACT. It has to do with the fact that we are purchasing a 'lease' to the land, not the land itself. Just one of those loopholes. ;)
 
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