Renovating an investment property while living in it

Hi there

Looking at purchasing an older house that requires a renovation before being able to be lease it out to a tenant.

Can we live in the investment property while renovating? What are the tax consequences? Looking at moving out once the renovation is complete.

Thanks

 

If you're a first home buyer it's a good decision IMHO.

 

Yes you can but can't claim expenses. Watch out for any plant and equipment as you may not be able to claim depreciation if not new

 

The tax issue to be defined is wether you satisfy;
1. The main residence test
2. The isolated profit making issue which may invalidate 1.

I would have concerns based on the very question

 

Depending on who is on the title. If your SMSF buys it, then you can't live there.

 

Correct. You'll automatically deny yourself much of the short-term benefit of depreciation if you install plant and equipment while living there. If it's possible, install these items after vacating and don't use them.

 

And the costs wont be deductible repair costs. They will be capital in nature and non-deductible but should be added to a QS report

 

Sure you can, this will allow you to work 16 hours a day on the place
So you can stay there for the convenience of the reno
Just don't "actually move in" though
Don't change you licence, voting detalis or anything else
Or as above, goodbye deductions