Say I am going to purchase a block of land in my name (no trusts or company structure) and build two dwellings on it.
This would be in addition to a day job and would be a one off for the time being.
the transaction looks like:
300k land purchase
10k land purchase costs (stamps, legals, conveyancing, etc)
600k build cost
910k total (land & construction)
If I sell one of the dwellings during construction, how is capital gains tax calculated?
Cost base = proportion of the land the sold dwelling occupies (let's say 50% in this scenario) 50% x 300k + 50% of land purchase costs (5k) & 50% of the build cost.
150k land
5k land purchase
300k build
455k Total
let's say the sale price is 550k and the property is sold before completion.
550k sale
-455k cost base
=95k capital gain
The land would be owned for less than 12 months so does this mean there would be no 50% discount?
Is the capital gain considered taxable income and added to any other taxable income earned in that financial year?
This would be in addition to a day job and would be a one off for the time being.
the transaction looks like:
300k land purchase
10k land purchase costs (stamps, legals, conveyancing, etc)
600k build cost
910k total (land & construction)
If I sell one of the dwellings during construction, how is capital gains tax calculated?
Cost base = proportion of the land the sold dwelling occupies (let's say 50% in this scenario) 50% x 300k + 50% of land purchase costs (5k) & 50% of the build cost.
150k land
5k land purchase
300k build
455k Total
let's say the sale price is 550k and the property is sold before completion.
550k sale
-455k cost base
=95k capital gain
The land would be owned for less than 12 months so does this mean there would be no 50% discount?
Is the capital gain considered taxable income and added to any other taxable income earned in that financial year?