we are also interested in wrapping techniques. have been collecting information on them till completely sure we have all the details. One thing we are wondering is.. CGT? does this apply, if so, is it from the date of the contract, ie when the wrappee moves in, or the date they buy you out with their own finance?
any thoughts welcome and appreciated.Hi Jude
Have a look at
https://www.propertyinvesting.com/article04_07.htmlCheers, Paul
Paul Dobson | Vendor Finance Institute
http://www.vendorfinanceinstitute.com.au
Email Me | Phone MeAn alternative way to finance your home.
CGT does not apply to wraps.
Hellman
Hellman
Don’t want to disagree with but having done 1 or 2 I must correct you.
“The Tax Office accepts that the likely correct way of treating income for a wrap is via “the emerging profits” rule. This is the recommendation made within the Position Paper.
Although it is acknowledged that CGT will apply, it is also acknowledged that the CGT is reduced by the income otherwise declared from the same transactions. In most cases, because income was declared greater than, or equal to, the Capital Gain, there should be no need CGT payable on the sale of the property.
The Tax Office also considered the situation whereby the purchaser defaults on the contract and concludes that the vendor should declare a Capital Gain on the forfeited deposit less any costs incurred in selling the property.
Cheers Richard
[email protected]
http://www.yourstatefinance.comSpecialising in US & IP finance.
Richard Taylor | Australia's leading private lender
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