Property sale proceeds: capital or revenue account?
Property prices are on the rise and we are seeing lots of residential subdivisions, farmers selling to developers, broadacre developments and people flipping houses.
It is no surprise that property transactions are a focus for the ATO. While advisers may think that the principles relevant to the revenue/capital distinction are settled, the reality is that taxpayers and the ATO still grapple with whether proceeds from the sale of property are on capital or revenue account.
In this webinar, partner Sarah Lancaster will explore when proceeds from property sales will be on revenue account or capital account, with case studies featuring her Bernese mountain dog, Maple.
After this webinar, you will be able to identify:
- what the ATO’s current position is
- when a property sale will be a mere realisation of a capital asset
- when a property sale will be part of a profit-making undertaking or business
- whether the relevant purpose is at the time the property is acquired or at some later point
- the different tax treatment of property sales (mere realisation, profit making undertaking or business)
options for your clients to manage the risks.