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First Home Buyers Scheme – How to Have Your Cake and Eat it Too!

first home buyer scheme

First Home Buyers Scheme – What other country in the world gives you cash to get a property and then gives you a tax break for owning that property once you are no longer living there?  It may seem crazy but that’s exactly what the Australian central authority has done.

Right now if you are a first house purchaser, under the goverment’s first home purchasers scheme you are entitled to $21,000 for purchasing a new home and $14,000 for buying an established home. That in itself is a very good break considering rates are at their lowest in years and property prices round the country have fallen.

But the genuine topping on the cake for first house purchasers is they are still eligible to claim depreciation on the property if they decide to hire the property out some time in the future. Read more…

The facts:

To receive the first home owners grant, buyers are required to occupy the home as a principal place of residence for a continous period of at least six months commencing within one year of the completion of the transaction. Depreciation allowances are figured out on the intended use of the property in the present tax year.

How to make it work for you:

The first homeowners grant favours buyers who purchase a brand new property. Talking generally, also attract higher depreciation allowances.

Before you buy, get an estimate of the likely depreciation allowances you’ll get on your property when you rent it out. You can do this by employing the Washington Brown Online Tax Depreciation Calculator. It will give you an appraisal of the likely tax savings you’ll get once you start using the property for investment purposes.

Quantity surveyors give the tax payer with 2 options for saying depreciation allowances. The diminishing value strategy speeded up the allowances you can claim and the prine cost strategy uniformly spreads ouf the allowances. The one you select will depend upon how long you plan to use your property as an investment.

The amount the home buyer can claim is only affected while they live in the property. It’s still depreciating at an identical quantity but you can’t claim this amount as a tax deduction. The reducing price system is more profitable in the short term.

The depreciation on every property will be different. If you choose to turn your castle into a rental down the track, ensure you talk with a professional quantity surveyor to guarantee you maximize your tax savings.

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