11: Navigating Tax on Subdividing and Selling Land

Taxes can take a huge bite out of real estate profits. So it is important to understand what you may be liable for when subdividing and selling land. In this complex area, proper tax planning is essential. In this episode, Sally demystifies the tangled web of rules around land transactions.

Join Sally as she demystifies the tangled web of rules around land transactions. Expect clear guidance on capital gains versus ordinary income, key factors on classification, and critical GST obligations.

In this episode of the Smarten Up! The Tax and Business Podcast, you’ll learn:

The three ways the ATO taxes property transactions (00:54)
The tax difference between capital gains and ordinary income (01:34)
Key factors that determine if land sales are capital gains or ordinary income (05:34)
How to handle GST obligations (10:06)
A detailed example covering subdividing land and building townhouses (13:56)

Selling land deals with complex tax implications that can make or break your profits. But with smart planning, you can legitimately minimise your tax obligations.