All Topics / The Treasure Chest / Stamp duty and legals

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  • Profile photo of EauSavageEauSavage
    Member
    @eausavage
    Join Date: 2003
    Post Count: 4

    Apologies if this is a silly question, but could anyone tell me if stamp duty and/or legal fees incurred when buying a property is a claimable expense at tax time?
    Cheers

    Profile photo of Stuart WemyssStuart Wemyss
    Member
    @stuart-wemyss
    Join Date: 2003
    Post Count: 598

    No. It is added to the ‘cost base’ of the asset when calculating the taxable capital gain/loss.

    Cheers

    Stu

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    Profile photo of NessieNessie
    Member
    @nessie
    Join Date: 2001
    Post Count: 73

    What Stuart has said is correct.
    Though I understand that if you borrow money to purchase your IP all the costs associated with the borrowings are spread over a 5 year period provided that the monies under the Mortgage remains owing after 5 years – that is you can claim one fifth of the borrowing costs each year for 5 years. These are usually the Bank’s application fee, valuation fee, stamp duty and regn fees on the Mortgage and any Solicitor costs for reviewing the Mortgage documents.
    If you repay the Mortgage within the 5 year period – you still claim one fifth for each year and in the year that you repay the loan you claim the balance of the costs.

    ie: Total borrowing costs are $500 – you claim $100 per year. If you pay off the loan in year 3, you would have already claimed $200, so in year 3 you would claim the final $300.

    I hope I have explained this clearly and it makes sense.

    Cheers
    Nessie

    Profile photo of EauSavageEauSavage
    Member
    @eausavage
    Join Date: 2003
    Post Count: 4

    Guys, thanks for clearing this up.
    Cheers

    Profile photo of HueyHuey
    Participant
    @huey
    Join Date: 2003
    Post Count: 213

    If you purchase an IP in Canberra you can claim the whole lot (stampduty + legal fees) in that financial year. It was explained in this forum before. I forget the threat number. [:)]

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