Date posted: 16/06/2023

Submission on Deductibility of Holding Costs for Land

CA ANZ’s feedback on the draft interpretation statement PUB 00417.

This interpretation statement considers the deductibility of holding costs for land and whether the land being taxed on sale is relevant to deductibility. The term “holding costs” refers to expenses incurred in relation to the ownership of land, being interest, rates and property insurance. Holding costs do not include capital improvement costs or expenses that relate to the use of the property.

CA ANZ largely agrees with the technical analysis and the conclusions reached in the statement. In CA ANZ’s view, the statement will provide taxpayers with certainty.

CA ANZ suggests some aspects of the item be reviewed and clarified with additional references.

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