Cost Base calculations - vacant block

Have searched the forum for this, but can't quite find exact answer I need - hopefully a straight forward ( and simple ) question for one of you more knowledgeable than I :

Purchased a vacant block of land 3yrs ago with intention to build our PPOR on ( zero intentions of ever being used for IP ). $149K + $2k (legals & bank costs)

Sold block recently, still vacant, but have constructed new timber fence on.

Sold for $149k - $5k (legals, real estate, & bank costs)

Basically just paid rates on it for the 3 years, mowed it, and had the fence built.

Block was never used for income producing purposes, and hence nothing was ever used for tax deductions whilst owning.

My accountant tells me we can only use the cost of the fence, and sale advertising costs in calculating the cost base for Capital loss - and not any interest on the loan.

My question is, how is this different from the example given on the ATO website :

Costs of owning

You do not include rates, insurance, land tax, maintenance and interest on money you borrowed to buy the property or finance improvements to it in the reduced cost base. You only included them in the cost base if:
?you acquired the property under a contract entered into after 20 August 1991 (or, if you didn't acquire it under a contract, you became the owner after that date), and
?you could not claim a deduction for the costs because you did not use the property to produce assessable income ? for example, it was vacant land, your main residence or a holiday home during the period.


Example

On 1 July 2009, Kris purchased a block of land for $40,000 (including legal fees, stamp duty and related expenses). On 30 June 2014, he sold it.

During the five years he owned the block, he paid $5,000 for rates, land tax and interest. As he did not use the land to generate any income, he could not claim a deduction for any of these expenses.

The cost base of the block of land is $45,000
.
 
You calculate a capital loss using a reduced cost base.

The reduced cost base does not include 3rd element holding costs like mortgage interest, rates, insurance.
 
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