Purchasing costs when to claim?

[robbo67]

Hi,

I've just purchased my first IP and am trying to sort out all my paperwork and filing and working out what I can claim in my first year so i can sort all the figures out in readyness for end of financial year in June. Thought if i start a good filing system now it would make it easier at tax time.

Can someone please help me with working out when these fees, charges etc would be claimable?

Bank establishment fees, annual package fee, discharge admin fee, title insurance fee, settlement processing fee, law stationers fee, registration fee and lastly Mortgage insurance fee. All these were charged by my bank. I'm thinking all but the Morgage Insurance fee are claimable in the first year with the MI claimable over 5 years....is this correct?

Also Conveyancer fees i have read are not claimable. But what about the Section 109 certificate, Strata inspection report charge and the Stamp duty of $8600 when is that claimable?


Cheers, Robbo.

 

[damacc]

Hi Robbo,
Congratulations on purchasing your 1st investment property.

The majority of the costs charged by your lender come under Borrowing Costs. Borrowing Costs are deductible over the period of the loan or 5 years whichever is the shortest. They are calculated on a pro-rata basis.

The other costs you mentioned - Conveyancer fees, Section 109 certificate, Strata inspection report charge and the Stamp duty are known as Capital Costs. Very simply, if you were to sell the property then they form what is known as the "Cost Base" and are used to work out Capital Gains. Some costs can be used as part of the Property Purchase calculation for the Depreciation Report to be done.

Don't forget to include the adjustments on your solicitors settlement statement for council rates, body corporate, water rates and strata levies in your expenses for the financial year.

 

[robbo67]

Hi Robbo,
Congratulations on purchasing your 1st investment property.

The majority of the costs charged by your lender come under Borrowing Costs. Borrowing Costs are deductible over the period of the loan or 5 years whichever is the shortest. They are calculated on a pro-rata basis.

The other costs you mentioned - Conveyancer fees, Section 109 certificate, Strata inspection report charge and the Stamp duty are known as Capital Costs. Very simply, if you were to sell the property then they form what is known as the "Cost Base" and are used to work out Capital Gains. Some costs can be used as part of the Property Purchase calculation for the Depreciation Report to be done.

Don't forget to include the adjustments on your solicitors settlement statement for council rates, body corporate, water rates and strata levies in your expenses for the financial year.

Thanks for the helpful reply! Just was a bit unsure of the lenders fees and the strata report (thought that would have been claimable straight away) so thanks again.

Yes i have included the adjustments from the solicitors settlement statement for the rates, strata, water etc in my filing for yearly deductions.

Looks like i may actually be organised and have a myself a good filing system in place....now lets see if i can continue to keep track of it all.