Looking to purchase a development site. I will live in the house for 12- 18 months while sorting out town planning. Then subdivide, build and retain one unit as PPR.
The property is an existing residential block with an old house on it.
Not sure how the margin scheme is documented Do I need to apply the Margin scheme during my purchase in the contract of sale?, or is it only applied in the contracts used to sell the units later on?
I have some idea of what the margin scheme is about but just not sure when it is declared.
Any other advise on the structure of this development due to the PPR involvement and saving CGT GST is most welcome.
I had a bit more of a search on this topic.
If I want to apply the margin scheme i dont do anything during the purchase of the property, other than retain a copy of the contract to prove the purchase price.
The margin scheme is brought about by being included in the contract of sale when I sell.
So i just purchase the property "normally", with no reference to the margin scheme.
Sound correct?
Here's a document from the ATO that I came across recently http://www.ato.gov.au/content/downloads/bus70665nat15145072010.pdf
It may have some answers.
itsandrew
Go as far as you can see and you will see further.
That’s correct jazz, as long as the property you’ve bought is not a commercial property – then it gets a bit more complicated.
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