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Purchase costs claimable at tax time - P&B, and Insurance

Discussion in 'Accounting & Tax' started by KayTea, 19th Nov, 2015.

  1. KayTea

    KayTea Well-Known Member

    Joined:
    10th Aug, 2015
    Posts:
    285
    Location:
    Brisbane
    Hi there.

    Hopefully, a quick and easy answer to this one. I've just settled my first IP, and am trying to align the ATO's information on what is claimable as 'purchase costs' (as per the list on their website), and what I've paid for, and what else is claimable, going forward.

    Can I claim the cost of the initial pest and building inspection, at the time of purchase - this was taken out after the contract was signed (but before the place was settled)? I can't see it listed on the ATO site.

    Also, it mentions that I can claim the insurance, but if this was paid for before settlement, can I claim it? (In QLD, the purchaser is responsible for providing insurance for the property within 48 hours of the contract being signed, so clearly it must be in place well before settlement). However, as I'm not officially the 'owner' at that point, I'm not sure if I'm able to claim it as an expense (yet).

    Cheers,
    KayTea
     
  2. Terry_w

    Terry_w Solicitor, Finance Broker, CTA Business Member

    Joined:
    18th Jun, 2015
    Posts:
    8,972
    Location:
    Sydney
    building inspection = capital cost
    building and landlord insurance is a deduction against income.
     
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  3. Paul@PFI

    Paul@PFI Tax Accounting + SMSF Business Member

    Joined:
    18th Jun, 2015
    Posts:
    2,363
    Location:
    Sydney
    Borrowing expenses = Deduct over 60mths
    Repairs before rented = Capital and not deductible. Maybe depreciable ?
    Some costs on lawyers settlement sheet may be deductible eg council rates, water, strata etc
    where intent is to rent asap.