Property Development has re-emerged as a significant commercial activity throughout Australia in recent years. The tax issues associated with this area are often challenging and require a good understanding of the interaction between ordinary income tax, CGT, GST and stamp duty.
Case studies in this seminar paper will deal with the following issues:
- subdividing and selling off part of a main residence (ie fulfilling the new Australian dream of converting the 1/4 acre block into quick cash)
- tax issues in demolishing a house and constructing new townhouses (becoming a one-off developer)
- speculative property development tax issues.
This is a slightly updated version of papers presented on 11 March 2004 at the 38th South Australian State Convention held at Sunset Cove and on 2 April 2004 at the 18th National Convention held in Melbourne.
This paper was also presented by Phil Renshaw and Todd Jones at the Tax Keys to Property seminar held in Perth on 24 September 2004.