I'm just about to buy my first property. I will be applying for the FHOG and will be fulfilling the requirements to move into the property within the first 12 months, but the place is currently tenanted.
As I will need to honour the current tenancy lease, I won't be able to move in for at least 7 months.Can I still claim this place as my PPoR when I move in? How does this affect any future CGT if and when I decide to sell the place?
Also – for the first 7 months (while I am renting the place and living somewhere else), can I then claim expenses (i.e. interest, strata fees etc) as tax deductions?
Many thanks
JadeHi is the 7 months after the settlement period? If so, I believe you must live in the property for 6months within the first 12 months. So you will have to evict your tenant to faciliate this.
Whilst it is an investment property you can claim deductables.
Thanks Maree – just to clariify – if I can work it out to move in within 6 months of settlement – does this mean that:
a) I can claim tax deductions while it is rented out
b) move in after 6 months, claim PPOR status and exempt myself from any CGT on sale (as long as I keep the property for longer than a year)?Thanks
JadeYes, that sounds like a fantastic plan. Plus do as much improvements as you can whilst the property is rented to claim on your tax
If the property is rented out when you first buy you can only claim it as a PPOR from when you move in. Julia Hartman suggested a strategy that might reduce or eliminate CGT in API last year
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