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What you need to know - Northern Territory HomeBuilder Grant

August 05, 2020

On 31 July 2020 the Department of Treasury and Finance, NT Revenue Office released its guidelines on the Federal Homebuilder grant.

The Territory Revenue Office guidance on the HomeBuilder grants are available here.

The HomeBuilder grant provides eligible owner-occupiers $25,000 towards the cost of building or buying a new home or substantially renovating an existing home.

From 1 January 2021, a revised version of the grant will become available providing a $15,000 grant for eligible new home projects and major renovations. HIA has developed information to assist members.

Information about the Federal HomeBuilder grant are detailed below.

WORK TYPES COVERED

•  Contract to build (house and land package).
•  Contract to build on land your client already owns.
•  Contract to purchase a new home (off the plan or speculative home).
•  Substantial renovation work, including ‘knock-down rebuild’.

WORK TYPES NOT COVERED

•  Additions to property such as swimming pools, tennis courts, outdoor spas, saunas, carports, sheds or stand-alone garages.
•  Stand-alone granny flats.
•  Renovations that are primarily cosmetic in purpose such as landscaping, painting or re-carpeting.
•  Work carried out by owner builders and investors.

CONTRACTS MUST BE SIGNED BETWEEN

4 June 2020 and 31 December 2020.

If the client/s have entered into a contract on or after 4 June 2020 that replaces a contract made prior to 4 June 2020 to build the same or substantially similar home, they may not be eligible to receive the HomeBuilder Grant.

CONSTRUCTION TIMEFRAMES

Building work must commence within 3 months of the date of signing the contract.

Applications can be made after signing the contract and the documents supporting evidence of commencement may be lodged when commencement of construction and the payment eligibility requirements milestones have been met.

New Builds/Off the plan purchases: Commencement of construction is when excavation and site preparation works begins.

Substantial renovations: Commencement of construction is when works under the renovation contract starts.

EXTENSION OF TIME

The Territory Revenue Office may allow an extension of time for commencement for up to a further 3 months if delays are unforeseen and outside the control of the parties to the contract.

Examples of unforeseen circumstances may include:

•  delays in obtaining building or planning approvals;
•  prolonged weather disruptions.

EVIDENCE TO SUPPORT COMMENCEMENT

New Builds/Off the plan purchases:Evidence of construction commencement (e.g. first inspection certificate or vendor statement for off the plan).

Evidence of construction commencement, including first invoice issued for work carried out under the renovation contract and receipt/s to show that $150,000 has been paid to the builder.

If applicable, a statement confirming reasons for the delays in construction commencement with supporting evidence.

WHEN WILL THE GRANT BE PAID?

New builds: The Grant will be paid after foundations have been laid and the first progress payment has been made to the builder.

Substantial renovations: After construction has commenced and evidence is submitted showing payments of a least $150 000 of the contract price have been made to the builder.

Off the plan purchases: After evidence is submitted showing that the property has been registered in your name on the certificate of title. The applicant must be registered on the certificate of title as the owner of the property by no later than 31 October 2022.

CONSTRUCTION CRITERIA

•  Owner-occupied as principal place of residence for a continuous period of at least 6 months from completion of construction or renovation.
•  Property must be in the Northern Territory.
•  Property must be fixed to the land (no mobile homes).

APPLICANT

Applicant must be:

•  Natural Person (not a company or trust).
•  18 years or over.
•  An Australian Citizen at the time of application.
•  Must not have previously received the Homebuilder grant in any Australian state or territory
•  Each person whose name is or will be on the certificate of title to the home must be an applicant for the grant.

If there is more than one person listed on the certificate of title, they must apply jointly as a couple, provided they meet the definition of a couple.

INCOME CAPS

For the 2018/2019 or 2019/2020 financial year:

•  $125,000 per annum for an individual applicant.
•  $200,000 per annum for a couple.

IMPLEMENTATION

Department of Treasury and Finance, Territory Revenue Office.

PROPERTY VALUE CAPS

•  New home $750,000 (including house and land and off the plan).
•  Substantial renovations the existing property not to exceed $1.5 million.

CONTRACT PRICE CAP

•  Contract value for new home not to exceed $750,000 (including house and land and off the plan).
•  Contract value of substantial renovation between $150,000 and $750,000.

BUILDER CRITERIA

All building work must be undertaken by a licenced builder.

TAX

Non-taxable.

TIMEFRAMES FOR APPLICATION

Application must be made after the contract is signed and lodged by 31 December 2020.

INTEGRITY MEASURES

•  Building work for a related parties to the building contract is prohibited.
•  Contracts must be made at arm’s length. This means the contract must be made by two parties acting freely and independently of each other, and without offering favour as a result of some special relationship, such as being related to one another.
•  The terms of the contract should be commercially reasonable, and the contract price should not be inflated compared to the fair market price.

Application Form

The Homebuilder grant application form and lodgment guide for the client/s to complete is available here.

The client/s will have to provide information about their income, citizenship, certificate of title and building contract, or a copy of the sales contract for the purchase of an off the plan home/new home.

Contact a HIA Workplace Adviser

1300 650 620

or email enquiry@hia.com.au

Current at: 5 August 2020
HIA ref no: NFSINP1356