I will point you to the ATO guides which I am also perusing for same purposes.

https://www.ato.gov.au/General/property/property-used-in-running-a-business/selling-commercial-premises/

Thanks Terry – so if I buy for Market Value (per the ATO’s Market valuation for tax purposes provisions and Spencer v C’wealth 1907) for tax purposes, does this trigger Vic stamp duty.

Or are they separate ideas i.e. love and affection for stamp duty and market value for CGT?

In this case I presume any surplus cash (sitting in the offset account) can / will be applied against the loan on the PPOR while the loan for the investment property will be interest only?

If the properties were held in separate trusts, would each trust get its own threshold?
At what point does “grouping” occur?

@crj thanks.

I think this is where the GST margin scheme comes into play.
The GST would be claimable on the construction cost.
You then have to remit 1/11th of the uplift (i.e. the margin).

For example land worth $300k, and construction cost of $250k + $25k GST.

Claim the $25k GST back. So total cost of $550k.

Property sold for $700k. Margin is therefore…[Read more]

Just to clarify in this example, is the interest on the current IP (former PPOR) is deductible (and the interest assessable) even though there is no CGT (during the 6 year exemption)?

So if I commence development, I can claim interest on the purchase of the land, plus the interest on borrowings for the progress payments to the builder?

Can I get a PAYG variation for the expected interest (whcih will help with my cashflow)?

Assuming the PPOR was owned by one spouse, could they sell to the other partner at Fair Value (stamp duty expection may apply e.g. in Victoria can do this for love and affection). Locks in the tax free capital gain and establishes cost base going forward.

The transfer might help with getting finance which would be a good reason for doing so.

In…[Read more]