Tax Advantages of Investing in Off-the-Plan Properties

Off-the-plan properties are becoming a top choice for Australians looking to invest smartly in real estate. While there are many reasons to go off the plan, one of the biggest drawcards is the range of tax benefits. If you’re buying your first home or starting your investment journey, understanding these tax perks can help you make better financial decisions.

What Does Off-the-Plan Mean?

Buying off the plan means you’re purchasing a property that hasn’t been built yet. You agree to a fixed price today, and the property is completed months or even years later.

This strategy suits both investors and first-home buyers. It gives you more time to save, plan your finances, and tap into property price growth.

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Depreciation Deductions

One of the biggest tax advantages comes from property depreciation. New properties allow investors to claim depreciation on both the building structure and its fittings.

You can claim:

• Capital works (building structure) over 40 years
• Plant and equipment (appliances, carpets, blinds) at varying rates

These deductions can significantly reduce your taxable income. That means you could receive a higher tax return each year.

Stamp Duty Savings

Some states and territories offer stamp duty concessions or exemptions on off-the-plan purchases. This is especially helpful for first-home buyers.

In places like Victoria and New South Wales, buying off the plan could mean paying stamp duty only on the land value at the contract date — not the full completed value.

Benefits include:

• Lower upfront costs
• More cash available for deposits and fees
• Extra breathing room to prepare for settlement

Always check your state’s current rules. Government incentives change over time and vary between locations.

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Timing and Tax Planning

When you buy off the plan, there’s often a long period between signing the contract and settlement. This can be used to your tax advantage.

You might be able to:

• Plan your tax affairs around settlement dates
• Structure your finances to match your investment strategy
• Delay loan drawdowns, reducing short-term interest costs

This time buffer lets you align your investment with your income and tax obligations more effectively.

GST Credits (For Eligible Investors)

Some property investors registered for GST may be eligible to claim GST credits on off-the-plan purchases. This generally applies to commercial property or if you're developing to resell.

You’ll need to meet strict requirements, so always speak to a tax adviser before assuming you’re eligible.

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Negative Gearing Benefits

If the cost of owning your investment property (interest, maintenance, etc.) exceeds the income it generates, you can claim the shortfall as a loss against your taxable income. This is called negative gearing.

Because off-the-plan properties are brand new, they often attract higher rents and lower maintenance costs. You still might be eligible for negative gearing benefits, depending on your loan and rental situation.

How Coposit Can Help

Saving a full deposit for an off-the-plan property can be tough. That’s where Coposit changes the game. With Coposit, you can secure a property with as little as $10,000, then pay the rest in weekly instalments during the construction period.

Coposit is not a loan. There’s no interest, no credit checks. It’s a smarter way to buy off the plan while staying in control of your budget. And the best part? You still enjoy all the tax benefits that come with investing in new property.

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Why Off-the-Plan Is a Smart Tax Strategy in 2025

With property prices stabilising and demand for new homes on the rise, buying off the plan in 2025 gives you both a strategic entry point and a range of tax advantages.

Here’s what makes it attractive:

• You can lock in today’s price and settle later
• Depreciation deductions boost your tax return
• Some buyers pay less stamp duty
• You gain time to manage your finances before settlement

Pair that with a flexible deposit solution like Coposit, and you’ve got a smart, tax-effective way to enter the property market or expand your investment portfolio.

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