Property developing can be a stressful and time-consuming affair. Not only do you need to carry out some extensive research within the property market but organising finance, consultants and a builder can be overwhelming. A lot of property developers neglect the fact that tax is another aspect that needs to be looked at diligently and this can potentially have the biggest impact when it comes to the outcome of your development. A property development accountant who is an expert and has experience with property development projects is the most important consultant for your project.

Your architect may cost you a few thousand, your town-planner may cost a few thousand and your builder will cost you a lot but what really affects the bottom-line is the tax you end up paying. Your property development tax accountant should be able to advise if you are running out of budget.

This will be let straight out of your profitability. A 10% GST + 27.5% tax on income = 37.5% of your hard-earned revenue to tax.

An experienced property development accountant shall be able to strategize and advise when various tax effects would apply:

  • Sale of apartments, units, townhouses = GST/CGT.
  • Costs of Development = GST.
  • Change in ownership = Stamp Duty.
  • Income from Renting = Income Tax.
  • Sale of a rental property = CGT.
  • Sale of an off the plan property = Income TAX + GST.

A property development business is quite complex when it comes to bookkeeping. Expenses need to be kept track off with GST on expenses to be claimed,business activity statements need to be lodged and tax returns for any entities involved. However, there are many implications that need to be considered when preparing the accounts for a property development project. A single Entity might run multiple projects and hence your property development accountant would need to take into consideration

  • Project based accounting – To correctly account for costs of different projects to ascertain profitability.
  • Stage based accounting – to know and understand what the different stages of property development actually cost. The major stages of a property development are as under.
    • Acquisition
    • Plans & Permits
    • Engineering
    • Building
    • Sale

This is where it is imperative that you have a property development accountantwho is experienced in accounting for Property Developers and they themselves understand your business and the inner workings. We first sit down with you and devise a blue print (feasibility analysis) of your project, this helps create a budget of various cost aspects and without this understanding you may be paying large amounts in unnecessary tax.

If you are a property developer and need to speak to a property development accountant, we encourage you to give us a call.

A One Accountants are specialists in accounting for property developers. Whether you are a first time or seasoned developer you can rest assured that A One accountants will handle the burden of lodgements and make sure that you are compliant at all times. Please feel free to contact one of our friendly staff on 03 8609 1889 to organise a consultation.