G’day guys,
Got a question regarding capital works & capital gains when selling a new house.
I’m thinking about building a new house on a block of land. I estimate to spend $20k on the property to finish it off once it’s built.
After selling the house and land I expect to clear 80k profit. (Selling price, minus cost of land, building and finishing costs)
I understand that the finishing costs, along with the stamp duty etc can be claimed as capital works.
Therefore, if I have to pay $20k (25% capital gains tax after 12mths) from the $80k profit – would the $20k+ claimed as capital works cancel out the $20k capital gains tax I’d have to pay?
Hope this makes sense:)
Cheers
Wayne
Wayne Leech
*Below are links to my websites – any feedback, comments would be appreciated:)
http://www.landsearcher.com.au – List your land for FREE (Private sellers only)
http://www.homesearcher.com.au – List your property for FREE (Private sellers only)if your profit is 80k, less the capital works of 20k = 60k. CGT will be taxed on the net profit which in this case will be the 60k. every cent you can think of, any expenses which have anything to do with this project can form part of the capital costs, even internet connection for your research of the investment, % of phone bill, travelling expenses. check with your accountant first but Im confident you can contribute anything that has anything to do with the project( maybe if it hasnt either)
You must be logged in to reply to this topic. If you don't have an account, you can register here.
