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What you need to know - South Australia Homebuilder Grant

On 17 July 2020 the Department of Treasury and Finance, RevenueSA released its guidelines on the Federal Homebuilder grant.

RevenueSA 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.

Information about the Federal Homebuilder grant are detailed below.

CONTRACTS MUST BE SIGNED BETWEEN

4 June 2020 and 31 December 2020.

Warning – contracts that replaced a contract signed before 4 June 2020 may not be eligible contracts

CONSTRUCTION TIMEFRAMES

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

An extension of time of up to 3 months may be granted by RevenueSA if there are sufficient grounds (see below).

Commencement is defined as:

  • For a new build, including those off the plan: When site works including excavation for the approved building works to the top of the base level is complete.
  • For substantial renovations: When the works under the renovation contract commence.

EXTENSION OF TIME

RevenueSA 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.

The following types of delays that may be considered a reasonable basis for an extension of time:

  • delays in obtaining council approvals;
  • difficulties in obtaining construction materials and/or sub-contractors;
  • delays in financial institutions assessing and approving finance;
  • inclement weather, where the disruption is substantial;
  • health problems relating to, or the death of, a person critical to the commencement of the project;
  • prolonged industrial disputes;
  • significant delays in the issue of title caused by the Land Titles Office; or
  • natural disasters.

Further information can be found here including circumstances in which an extension of time may not be granted.

EVIDENCE TO SUPPORT COMMENCEMENT

Commencement must be supported by evidence such as a statutory declaration from the builder or a mandatory notification form which is used to notify local councils of stages of work.

WHEN WILL THE GRANT BE PAID?

  • New builds: After construction has commenced and evidence is submitted which shows that 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 i.e. copies of payment receipts.
  • Off the plan/new home contracts: After evidence is submitted showing registration of property title in the applicant(s) and practical completion form from the builder.

CONSTRUCTION CRITERIA

  • Owner-occupied as principal place of residence.
  • Property must be in South Australia
  • 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

Joint applicants must be married, couple in a registered relationship or defacto couple living in a genuine domestic relationship.

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, RevenueSA

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 (this includes cousins, uncles, aunts, nephews, and nieces as well as related company and trust).
  • Contracts must be made at arm’s length (this means that the contract must be made by the two parties freely and independently of each other, and without the contract having been influenced by a special relationship between the parties).
  • Contract prices must be at market rates and cannot be artificially inflated or deflated
  • If value of transaction changes the amount declared in application and the new value breaches the monetary limits you must notify RevenueSA within 14 days and will be required to repay the grant.

Application Form

The application form for the client/s to complete is available here.

The client/s will have to provide personal information about their income and about the building contract.  They will need to supply evidence that the builder is licensed and provide a copy of the building contract.

The client/s have to sign a statutory declaration when they complete the form.  While builders can provide information to help clients prepare forms they should leave the actual completion of the form to the clients as the clients have to declare that the contents are true and correct.

Contact a HIA Workplace Adviser on 1300 650 620 for further information and advice

Current at: 21July 2020
HIA ref no: SFSINP1350