how to claim stamp duty for IP in Canberra

i bought an IP in Canberra in Feb 2010 (contracts exchanged), paid SD on it in Feb 2011 and settlement of this property is in Dec 2011. SD paid on IP in Canberra can be claimed as a lease document expense.

i called ATO's individual tax helpline to find out how to claim the SD and they said it can be claimed in the year it is incurred if property is or will be used for producing rental income. however, their call centre OP could not tell which specific item the SD can be claimed under. he said that claim it under any item in the rental property schedule (under Section "Income/21 - Rent" in eTax).

so i'm including it under "Borrowing expenses" under the Rent section in eTax. has anyone claimed the SD thus in Canberra? can anyone let me know if i've been given the right advice and if i am claiming it correctly.

thanks
 
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I can't give you that answer I'm sorry. My accountant has always filled in my returns.

Be careful though that there's a gotcha on that SD exemption. In the ACT you pay land tax on investment properties.

Do you think you should start taking things to your accountant? He may be able to suggest things to you to make things easier in the future.

For instance have you arranged a depreciation schedule? Do you know what items you can claim as acquisition costs now and which items when you sell?
 
I can't give you that answer I'm sorry. My accountant has always filled in my returns.

Be careful though that there's a gotcha on that SD exemption. In the ACT you pay land tax on investment properties.

Do you think you should start taking things to your accountant? He may be able to suggest things to you to make things easier in the future.

For instance have you arranged a depreciation schedule? Do you know what items you can claim as acquisition costs now and which items when you sell?

Hi geoffw,

thanks for the quick reply.

i've been doing my own returns till now, while they are manageable;) i'll definitely have to seek an accountant for next FY.

re land tax, that can be claimed as an immediate deduction. i don't have to worry about that for FY10/11 as i have not paid that yet.

depreciating assets are deductible over a number of income years, so not worrying about that for FY 10/11 as the property is not producing any income yet.

i'm referring to the guide for rental property owners here -> http://www.ato.gov.au/content/downloads/IND00270214N17290611.pdf
 
Yes about the depreciation. But have a professional draw up the schedule before its available for tenants- which is presumably in a month.
 
Borrowing expenses are claimed over 5 years. So if you attribute it to this category you won't be following the instructions of the ATO person who said you could claim it in one year.

I don't know anything about the etax but imagine you would claim it as an expense like rates.
 
Do you think you should start taking things to your accountant? He may be able to suggest things to you to make things easier in the future.

A good accountant will often pick up on things that you may have missed as well.

Cheers

Jamie
 
I 2nd the vote for using accountants.

Mine gets a better result that I would even if I was happy to spend many extra hours invested - which I am not.
 
thanks all for your replies.

i agree with your idea of using an accountant which i'll be doing from the next FY. the way i see it is that doing my own returns, while they are fairly straightforward, has given me some understanding of our tax system and has placed me in good stead to ask an accountant informed questions..plus i can strut around as a 'specialist' in front of my friends:cool:

btw, was on the phone to ATO for 45 minutes today and their 'specialist' advised to include the lease document expense under "(V) Sundry rental expenses" under "21 - Rent" in etax...in the days of paper tax packs, it went under "Other". ATO gave me a reference number for this advice as well in case someone came sniffing later on..
 
I liked doing my tax returns myself too. What happened though was that I missed something for a few years and it cost me a few thousand.

So what I did after that was added it all up myself and worked out what I would get back and then send it off to an accountant. He would always do better than me and get me more back too.
 
Stamp duty on purchase forms part of the cost base of the house along with the legals on purchase of the property. It is not claimable as a running expense in the year it is paid, it is considered a Capital expense.

Stamp duty on a mortgage is claimable under borrowing expenses and if greater than $300 written off over five years.
 
Stamp duty on purchase forms part of the cost base of the house along with the legals on purchase of the property. It is not claimable as a running expense in the year it is paid, it is considered a Capital expense.

Stamp duty on a mortgage is claimable under borrowing expenses and if greater than $300 written off over five years.
Hi there

Not quite the case in the ACT. We can write it off in the first year.

Cheers

Jamie
 
Hi there

Not quite the case in the ACT. We can write it off in the first year.

Cheers

Jamie
is it only applicable to 99year crown lease?

stamp duty you incur when you acquire a leasehold interest in property such as an Australian Capital Territory 99-year crown lease (you may be able to claim this as a lease document expense)
 
i agree with your idea of using an accountant which i'll be doing from the next FY. the way i see it is that doing my own returns, while they are fairly straightforward, has given me some understanding of our tax system and has placed me in good stead to ask an accountant informed questions..plus i can strut around as a 'specialist' in front of my friends:cool:

Or you could mess it up this year forcing your accountant to have to go back and amend this year's return. I suggest to people that if they do plan on doing things on their own, its always worth seeing an accountant the first year so they can see where everything goes at least.
 
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