Hi,
Moving back to Australia.
I have 4 investment properties.
3 properties are large homes rental out long ter,
1 is an 2 bedroom apartment plus study that is rented out monthly bases over the last 2 years renting out at 350 per week.
All properties solely in my name.
Shall I kick out the tenant that is living in the apartment or shall I rent out property for myself and partner to live in.
I thinking if I keep the tenant renting the apartmet I am able to claim interest, depreciation etc, where if I move in i lose those deductations.
Where if I rented a property for 350 per week, I would not have to pay for maintence for the property etc.
On paper it seems smarter to rent out a separate property for myself and partner rather than kick out my tenant.
What does everyne think???
Even although the apartment is rented on a monthly basis, depending on the state your asset is in you may need to give longer notice eg 60 days in NSW
It may also look like a direct offset ie $350 in vs $350 out but unless you take your tax situation into account you would probably be looking at a much cheaper rental to move into as you would be paying rent out of your after tax income and your unit gives you pre-tax income.
I thinking I be able to claim interest and depreciation on the apartment if I continued to rent out,
Interest PA approx = 12000
Depreciation on a 2 year old apartment that is fully furnished. Apartment paid 450k and furniture 20k.
Plus other epxense such as body corporate which is 5k this year etc
So I am thinking if I move in I lose the ability to save many thousands of tax money.
I am thinking what is the point of living in my own property. When I could just buy some more IP and claim more depreciations and expenses and have a completely tax free income for almost life. I have set myself up to have tax free income for at least the next 3 years with the tax credits I have built up s far without anymore deductions.
What is the point of living in your own property where you can not claim maintenace and depreciation as depreciation on your tax returns.
In Norway for examples you can count your principal home interest paid on your mortgage as deductions.
From a tax perspective, definitely better to rent out a separate place for you and your partner to take advantage of all the tax benefits of having investment properties, especially if you are applying negative gearing.
Plus when you rent your own – you may also be eligible to deduct occupancy expenses depending on what kind of work you and your partner are in.
Fletcher Tax Accountants
http://www.fletchertaxaccountants.com.auHello,
Fletcertax,
As I am lookinjg for a new job (Not very good timing)
What sort of work would fit in that catergory??
I assume ou have dealt with some people like that.
Nicole
Hi Nicole, basically any work that requires you to work from home and use your computer etc. Can't be just for convenience but rather an expectation and requirement of employment or type of work.
Please feel free to email us direct if we may of any further help,
Fletcher Tax Accountants
http://www.fletchertaxaccountants.com.au
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