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Buying commercial property

Make sure to keep records when you buy commercial property to claim deductions and GST credits for some costs.

Last updated 9 July 2020

When you buy or obtain a commercial property such as a shop, factory or office, it's important to keep records right from the start.

For example – commercial properties are subject to capital gains tax when you sell them. Even though it's in the future, you'll need records of the date and costs of buying the property, so you can work out your capital gain or loss later on.

Deductions for commercial property

If your property is used for business purposes you:

  • can claim a deduction for expenses associated with owning it, such as interest on the loan to buy the property and maintenance expenses
  • should keep records of all your expenses, so you can claim everything you're entitled to.

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GST on commercial property

If you buy commercial property, you may be eligible to claim GST credits:

  • for the GST included in the purchase price
  • on expenses relating to buying the property – such as the GST included in solicitors' fees and on-going running expenses.

You can't claim GST credits if:

  • the seller used the margin scheme to work out the GST included in the price
  • you buy property from someone who is not registered or required to be registered for GST
  • you buy the property as a GST-free supply
  • you're not registered for GST.

See also: