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Junior3156(Newbie)Newbie
12 Oct 2021

Hi, I am new to property Investment and need some guidance. I bought a land early last year, with an intention to build and rent out. I entered separate Land and build contracts and Land was settled in July2020. I had two investment loans, one for Land and another for Build. Building work started in Sep 2020. Occupancy permit was issued March 2021 and then Covid restriction introduced which delayed final settlement, which also delayed the advertisement for rental. Finally, Property was advertised (early June) for rental - a week before final settlement and house was settled in mid-June. Property was rented out in July2021. I have obtained a Depreciation schedule from a qualified quantity surveyor – report has deductions calculated from Occupancy permit date. Kindly provide some guidance on below - Can I claim deductions without rental income in 2020-21 year? - Can I claim deductions from Occupancy permit date, if not which date I should base my calculations from? - How do I treat interest and other expenses related to “build period�?

10,677 views
3 replies
10,677 views
3 replies

Most helpful response

Most helpful reply

JodieR_ATO(Community Support)Community Support
18 Oct 2021

Hi @Junior3156


The legislation changed from 1 July 2019. You can't claim deductions against vacant land. If the property is being built and not available for rent or being rented, you cannot claim deductions until this occurs. Once it's available for rent you can use this date forward to claim expenses.


However, any expenses you incur while it's being built and not available for rent, can be looked at under elements of the cost base when you sell or dispose of the property.


For more info on deductions on your property if its rented or available to rent, and rental expenses - visit our website.

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Building an Investment Property – When do I start to claim my deductions? | ATO Community