In June 2020, the Australian Government announced a HomeBuilder grant to encourage new home builds and re-stimulate the building industry that had taken a hit during the coronavirus economic downturn.
The HomeBuilders grant is a tax-free grant given to eligible owner-occupiers (including first home buyers) to build a new home, substantially renovate an existing home or buy an off-the-plan home/new home.
The Grant being provided depends on when an owner-occupier enters into a contract to build or renovate.
For contracts entered into between 4 June 2020 and 31 December 2020 the grant is $25,000. For contracts entered into from 1 January 2021 through until 31 March 2021, the grant is $15,000.
It is important to note that all applications for the HomeBuilders Grant must be submitted by 14 April 2021.
Some of the key HomeBuilder Grant requirements are detailed below. This information has been extracted from the State Revenue Office website.
- Each Applicant must be:
- A natural person (not a company or trust);
- Aged 18 years or older at the date of the contract; and
- An Australian citizen at the date of the application.
- Applicant(s) must be registered on the certificate of title as the owner of the land, timing of which is subject to the type of contract entered into.
- Applicant(s) must be below one of the following two income caps:
- $125,000 per annum for an individual based on either your 2018-19 or 2019-20 taxable income, as shown on your notice of assessment issued by the Australian Taxation Office; or
- $200,000 per annum for a couple based on either your combined 2018-19 or 2019-20 taxable income, as shown on your notices of assessment issued by the Australian Taxation Office.
- Each applicant must not have previously received the HomeBuilder Grant for any property owned individually of jointly with another person in an Australian state or territory.
- Each applicant must live in the home as their principal place of residence for a continuous period of at least 6 months immediately on completion of construction, renovation or settlement.
- Investment properties are excluded from the HomeBuilder program.
The home must be:
- located in Victoria
- fixed to your land;
- suitable as a place of residence; and
- owned, or will be owned, by you (both dwelling and land).
Substantial Renovations Requirements:
For the purposes of HomeBuilder, substantial renovations can be either:
- substantially altering the existing dwelling; or
- demolishing your home and building a new home on the land.
To be considered substantial, the renovation does not need to involve the removal or replacement of foundations, external walls, interior supporting walls, floors, roof or staircases. However, it should improve the accessibility, safety or liveability of the property.
Given these requirements, a substantial renovation does not generally include:
- Stand-alone granny flats, swimming pools, tennis courts, and structures not connected to the building such as outdoor spas, saunas, sheds or stand-alone garages.
- Renovations that are primarily cosmetic in purpose such as landscaping, painting or re-carpeting.
- Refer here for details of different types of eligible contracts which may be applicable to you.
The HomeBuilder grant will be paid once the State Revenue Office Victoria is satisfied that you meet all of the eligibility criteria. The timing of the payment of the Grant will depend on whether your application relates to:
- A new build – the Grant will be paid after foundations have been laid and the first progress payment has been made to the builder.
- A substantial renovation – the Grant will be paid after construction has commenced and evidence is submitted showing payments of at least $150,000 of the contract price have been made to the builder.
- An off-the-plan home/new home contract – the Grant will be paid after evidence is submitted showing that the property has been registered in your name on the certificate of title. You must be registered on the certificate of title as the owner of the property by no later than 30 April 2023.
Homebuilder will be paid into your nominated account when all eligibility criteria have been met and all supporting documentation provided. This account must be an Australian account (e.g. a savings account, a loan account or cheque account).
For more detailed information regarding the HomeBuilder grant and your eligibility criteria, please refer to the SRO website here.
The Davidsons team is here to assist with your eligibility assessment and Grant facilitation if required. For more information contact your Davidsons team member. Alternatively call us on 03 5221 6399 or email us at email@example.com for more assistance.
Disclaimer: this information is of a general nature and should not be viewed as representing financial advice. Users of this information are encouraged to seek further advice if they are unclear as to the meaning of anything contained in this article. Davidsons accepts no responsibility for any loss suffered as a result of any party using or relying on this article.