Hi There,
If investment propeorty sale contract is done before year end (like in May-2025), but settlement take place in Aug-2025. The sale is subject to CGT.
Question is - how about the expenses incurred betwen July and Aug-25? Like Bank interest and settlement expenese, agent fee etc.
Can this all be deducted in CGT calcualation for June-2025?
Yes, but holding costs cannot increase a capital loss.
Best to go to a local tax agent experienced with property.
(Taxicorn) - when you say holding costs, what does it mean?
I also don't understand - 'cannot increase a capital loss'.
If you could assist to explain
Interest, rates, water, insurance, repairs.
That is why = Best to go to a local tax agent experienced with property.
but if the property was never on rent? and it's part of the overall cost of the buidling then?
but if the property was never on rent?
Still subject to CGT
and it's part of the overall cost of the buidling then?
Interest, rates, water, insurance, repairs = holding costs.
Although CGT event happened when the contract is properly executed, you are still the legal owner until the settlement date (i.e. your name is still on the land title). So, you should account for all property related cost until the settlement date.
Selling cost, agent commission are part of the cost base. You are deemed to incur this when you sign the contract even though usually these are paid as part of the settlement.
Holding costs (e.g. interest, rates etc) must be deducted in the year that it is incurred to the extent the property is still genuinely available for rent. If the property is not available for rent, then they are not deductible and added to the cost base.
For more detailed information, your can read on ATO guidelines on cost base of assets
Thank you - very much appreciated.
(Enthusiast)
Enthusiast
So if the intent of the property building was owner occupier but end-up selling due to some reason, hence property was never available for rent. Does it mean that interest paid during the build time (+ other holding cost like rates etc) - can be considered part of base cost? or they need to be deductible expense in this instance?
Intent matters. If you never had the intention to making the property available for rent, then all holding costs is considered personal and cannot be deductible or included in your cost base.
15 Apr 2026 · 4 min read time
15 Apr 2026 · 8 min read time
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