My home is on acreage, which I am now able to subdivide.
Could I sell it to a company at an inflated price, pay the stamp duty and legals, but pay no tax, as it is my home.
Then the company subdivides and sells the blocks at little or no profit, thus no tax.Sounds too good to be true, is it.
You could do it, but if you are selling at a price other than market value you would legally be required to pay stamp duty and taxes etc at the market value.
If you get audited you would have to justofy your prices. Maybe you could get some valuations done and ask the valuer to make them as high as possible.
Terryw
Discover Home Loans
North Sydney
[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
I thought I would get it valued at the total I would get for selling the blocks, eg; $500,000 and pay stamp duty on that, which is a lot less than the tax would be.
Originally posted by investron:I thought I would get it valued at the total I would get for selling the blocks, eg; $500,000 and pay stamp duty on that, which is a lot less than the tax would be.
If you can find a valuer who will give a bogus valuation, cause thats what it is, while guessing you want it for the ATO and he dosn’t want half your profit pass him onto me.
Your property has one value, unsubdevided, and one value when it does. You may get him to push the valuation up to the high side, but past that and he is putting his head on the line for your profit.
good luck
Not only his head, but your head too.
There should be plenty of profit in doing it legally.
Cheers,
Aceyducey
you will be selling a principal residence anyway, so why bother? am I missing a technicality?
Extensive list of new Perth property available for sale.Alternatively, become a joint venture partner in one of our property development partnerships – contact me to find out why our developments are unique. John – 0419 198 856
Ausprop,
Once you subdivide it’s only the bit with your house on that’s considered the PPOR (in very basic terms).
When you subdivide & build the BEST thing to do is move into the new house & sell the old as your PPOR. Then after a year subdivide again, move into the new house & sell the one you were living in for a year…ad infinitum (until you can’t subdivide anymore).
Of course this may not suit what you want to do – so do what you want to do
Cheers,
Aceyducey
Hi Acey,
By the time you have finished that you’ll be able to start the whole process all over again – I am sure zoning rules would have changed sufficiently by then[biggrin]
Derek
[email protected]Property Investment Support Available. Ongoing and never stopping. PM welcome.
Investron,
Providing the property you are talking about is less than 5 acres and you have lived there since you purchased it, selling it to a company will not attract CGT but the transfer must be at market value. There are also provisions that may eleminiate your need for a company and therefore stamp duty on the transfer. Note a discressionary trust may be better than a company as companies do not qualify for the 50% CGT discout. This may not be relevant if the company’s purpose was to by blocks of alnd to hold as trading stock.julia#bantacs.com.au
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