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First Home Owners Grant

Discussion in 'Accounting & Tax' started by Frosty123, 13th Apr, 2016.

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  1. Frosty123

    Frosty123 Well-Known Member

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    Hi all,

    I've recieved a letter from the SRO Victoria advising my first property was not entitled to the FHOG. The property was purchased in 2013, and I lived in the property with my partner for just over 11 months.
    We then leased the property out so we could live in the city for a couple of years. We're now back in the property, and I'd recieved a letter from the SRO advising we are to pay the FHOG back with penalty applied if we admit wrong doing.

    I'm thinking back to when we leased the property, and I recall reading that the requirement was to only reside in the property for 6 months within the first 12 months.

    Does anyone have any knowledge of this. We certainly aren't trying to scam anyone, we're planning on living here for the long term.

    Appreciate any help

    Thanks
     
  2. Frosty123

    Frosty123 Well-Known Member

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  3. Hodor

    Hodor Well-Known Member

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    It is six months within the first 12.

    What reason are they giving you?
     
  4. thatbum

    thatbum Well-Known Member

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    How are they alleging you aren't entitled to it...?
     
  5. Frosty123

    Frosty123 Well-Known Member

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    The reason given was:

    To be eligible to receive the PPR concession and the first home buyers duty reduction you must:
    • Use the property as your PPR within 12 months of becoming entitled to possession of the property (which usually occurs at settlement) and
    • Reside in the property for a continuous period of at least 12 months.
     
  6. Hodor

    Hodor Well-Known Member

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    Must have been updated since I looked (1 July 2013 was last update per website).

    "You (or at least one applicant) must intend to live in the home as your PPR for at least 12 months, commencing within 12 months of settlement or completion of construction"

    First Home Owner | State Revenue Office

    I wonder if you could argue that you did intend to. You were there for over 11 months which is pretty good evidence you tried.
     
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  7. Simon Moore

    Simon Moore Mortgage Broker - Melbourne Business Member

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    Wow that's a crap situation :( You could try sending them that article, saying you relied upon it in good faith. Worth a shot!
     
  8. Frosty123

    Frosty123 Well-Known Member

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    Thanks for the comments guys.
    It sounds like it'll come down to how lenient they are, and how I best word my situation to the SRO.
    Is it worth getting an accountant to assist with responding to the matter who may deal with the SRO on a regular basis?
     
  9. Frosty123

    Frosty123 Well-Known Member

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    So after a bit of investigation, I looked at an archive of their website dating back to 2013.

    Eligibility To Receive The Grant

    Turns out that it was 6 months at the time (settlement occurred only a few weeks after this snap shot for me).

    • You (or at least one applicant) must occupy the home as your/their principal place of residence for a continuous period of at least 6 months, commencing within 12 months of either settlement or completion of construction (the residency requirement).
     
  10. Paul@PFI

    Paul@PFI Tax Accounting + SMSF Business Member

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    Apply for the First Home Owner Grant (FHOG) | State Revenue Office

    This says 12 months. Are you referring to the same grant as them ?
    What date was it settled ? I believe that is the relevant date. There is a link to the pre-1 July 13 rules too.

    Interesting it says intend to reside continually. I wonder if the same vagueness applies to the actual legislation ? If the grant is based on intent then what factors do OSR accept as a variation from the intent without it being refundable ? (A long shot)
     
    Last edited: 14th Apr, 2016
  11. Frosty123

    Frosty123 Well-Known Member

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    Sorry to bump this one up again, but it turns out the SRO Investigator was referring to the PPR and First Home Duty Concession.
    After looking at parts of the duty act, it seems that my only fall back was that I did intend to live in the property for 12 months (falling only 20 days short) and that I moved for work purposes (to save an extra 2 hours commute each day).
    I can see the SRO required me to inform them within 30 days of my circumstance changing, however I clearly wasn't aware of this requirement (or else I would have stayed longer...)
    I can see that several months after settlement of my property, they made the following form a requirement by banks to give to first home owners

    http://www.sro.vic.gov.au/sites/default/files/Duties-Form-53D_1.pdf

    I wonder if this could support my argument of being unaware of the requirements (I know...ignorance is no excuse).

    One final thought...is it worth having a solicitor assist in filing this objection? Someone who may deal with the SRO on a more regular basis? I'd obviously be happy to pay for this service if it means I could avoid paying the $10k or so in duty and penalty.
     
    Last edited: 28th Apr, 2016
  12. Paul@PFI

    Paul@PFI Tax Accounting + SMSF Business Member

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    Probably a wise move. Taxpayers often admit and disclose facts that get used against them. Lawyers are wise to these issues and avoid disclosures. Question is who ?
     
  13. Frosty123

    Frosty123 Well-Known Member

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    Any recommendations?
     
  14. Paul@PFI

    Paul@PFI Tax Accounting + SMSF Business Member

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