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Apogees(Initiate)Initiate
8 June 2024

Hi all,


I am not clear with vacant land rules. My understanding is that we can claim construction costs, such as interest on it during construction as long as the intent is to rent it out.


Say for example, if a person been building on this vacant land for 2 years, they can claim the costs and negative gearing (despite having zero rental income).


But what if after the construction is finished they decided to move in and make it their ppor? Or what if they rented it out to a mate instead?

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Taxduck(Taxicorn)Taxicorn
8 June 2024

Changes to legislation mean that as from 1 July 2019 holding costs can no longer be claimed on vacant land until there is a permanent structure which can lawfully be able to be occupied and is available for rent. This link explains.

https://www.ato.gov.au/individuals-and-families/investments-and-assets/land-vacant-land-and-subdividing/deductions-for-vacant-land

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Change of intend after claiming Vacant land construction costs | ATO Community