Stamp Duty Deduction for Residential Investment Property in ACT (Vacant Land)

 Author: DKL(Newbie)Newbie

22 July 2023

Below are the relevant details pertaining to my situation:

1. Land Purchase: I purchased and settled the land intended for a residential investment property in June 2022.
2. Stamp Duty Notice and Payment: In July 2022, I received the stamp duty notice from the ACT Revenue Office and subsequently made the payment in August 2022.
3. Property Status: As of 30 June 2023, the property is still under construction and is expected to take an additional 2 months before becoming available for rent.

I am seeking clarity on the following matters:

1. Stamp Duty Deduction: Am I allowed to claim the stamp duty paid for the land purchase as a tax deduction under these circumstances?
2. Reporting in Tax Return: If the stamp duty is claimable, could you kindly guide me on where to appropriately enter this deduction in my tax return? As the property is still under construction and not yet generating rental income, I understand that I cannot create a rental schedule.
3. Impact on Cost Base: If I am unable to claim the stamp duty as a deduction, will it be included in the cost base of the property for future reference?
4. Vacant Land Categorization: Due to current laws, the property is classified as vacant land, rendering me ineligible to claim Council Rates, Water Rates, Interest, and other borrowing and holding expenses. is my understanding correct?

Thank you for the help.

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