Upgrading PPOR in the ACT

Hello,

First time poster, long time reader.

To start with, of course I will be speaking to an accountant about this, but thought I would pick some brains here too.

If I am to buy a house in the ACT now and rent it out immediately for, say, a year, is the stamp duty on my purchase still 100% deductible in the first year (as a lease document expense)? I was speaking to someone recently who thinks the law may have recently changed regarding this and it is no longer a 100% first year deduction? Anyone have any ideas?

Thanks, and thanks for all the information over the years - this forum is a very valuable resource!

Cheers,
Damian
 
I believe the stamp duty will be deductible in the financial year the property was purchased. I haven't heard anything about this changing however there have been some changes to reducing stamp duty in the ACT.

Who were you speaking to about changes in claiming stamp duty?
 
I believe the stamp duty will be deductible in the financial year the property was purchased. I haven't heard anything about this changing however there have been some changes to reducing stamp duty in the ACT.

Who were you speaking to about changes in claiming stamp duty?
Thanks for the quick reply Will. I was speaking to a friend at work who I consider to be quite knowledgeable :) As I said, I will do my own research, just wondered if anyone had heard anything similar.
 
Hi Damian

I think it's changed.

I had a quick chat to my accountant the other day and she mentioned that this little loop hole had been closed or was in the process of being closed.

Speak with a decent accountant about it before proceeding.

Cheers

Jamie
 
Acquisition costs such as stamp duty on the purchase of an asset are considered to be capital costs and form part of the cost base for CGT purposes. i.e. it reduces the capital gain on subsequent sale.
 
Gary, it's different in the ACT. Up until now, stamp duty has been fully tax deductible in the financial year that you pay it on an IP. This thread is suggesting that that has changed.
 
Gary - in the ACT when you purchase a property you dont own the land, you lease it for 99 years. Because of the leasehold arrangements there has been a loophole that means you can claim stamp duty as a tax deduction in the ACT. Totally different to other states.

These guys have been talking about a possible change to that situation.
 
A change to that position in the ACT would be disappointing. Investment properties are subject to an ACT tax, making it more expensive to own an IP. This has been partially offset by the stamp duty deduction (even though the deduction would be claimable further down the track, when selling).

It's understandable from the ATO though. They lose income in both the sale and ongoing income.
 
My understanding is that it's still ok for normal IPs.

It's just a different story for the "rent out my PPOR for one year when it settles" and claim it as an IP. Apparently the SD will now be apportioned according to the time it was an IP.

An ACT accountant will be able to confirm.

Cheers

Jamie
 
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