battle axe development tax question

Hi all,

now i'm pretty sure cgt doesn't apply but wanted to ask anyways

if i buy a property and subdivide and build a house at the back and sell that house, would the first house still be eligible for cgt concession when i went to sell it? which would be over 18 months from originally purchasing.

purchase is in personal name

 

it could be depending on the circumstances, but if you sell one after purchase and sell another soon after it is probably more likely to be revenue account.

 

is there any kind of time frame where it would differ from revenue to cg? for the first existing property

 

not really

 

TD 92/135 may be relevant if the question of main residence for one of them is being considered.

Our developer toolkit address many of the base issues and is good pre-reading before personal advice. This will also indicate the GST and isolated profit making issues. Many people immediately jump to CGT when property sales had been taxed for decades before CGT was even a tax. CGT generally arises for a income producing property held to produce income. New construction is less likely to be a CGT issue than ordinary income but there are loads and loads of exceptions and issues that only personal advice could address.

In my opinion you need to know what taxes will apply so you neither pay too much or too little and cost this into a plan. Many people think developing land is a certain profit but it is not esp on small scale lots and those recently acquired. The ATO can take more than many developers...even when its a loss they still get their bit. . The ATO has unlimited time to catch up.

And if its a bit grey the laws were framed so that CGT is NOT predominant. Ordinary income prevails over CGT.