Hi Mick,Yes, this is available for anyone operating a business, regardless of the structure they are using. The tax saving is harder to quantify, due to the marginal tax rates. On the above example, at top marginal rate, that tax saving would be $1500 x 46.5%, = $697.50. To qualify for the 50% reduction, your turnover must be under $2 million.

The interest on your borrowing affects your profits, and your return on investment, but the yield is simply the income / the property cost or value.

Borrowing doesn't affect the rental yield.

The deduction would be claimed in your tax return, along with all of your other deductions for running your business.

I didn't explain myself fully. I don't think you can't add holding costs to your cost base for a PPOR. If you had a holiday home which was never subject to the main residence exemption, you could add all the holding costs to the cost base, because the gain is subject to CGT. In Stage's case, some of the gain is not assessable due to the main…[Read more]

The legislation says you must be running a business.

No, moving back in will not help you. Because it was rented out from the beginning, the 6 year rule does not apply in the first instance. For the next period of rental, the first six years of rental can be claimed as your PPOR PROVIDED you did not have another main residence. Also, Kevin, you can't claim interest and rates and other holding costs…[Read more]

Just to answer your Capital Gains question, the answer is yes, you would still pay CGT even though you aren't working. But the good news is, you pay CGT at your normal marginal rate, so your marginal rate will be lower than if you had other income.

For cars, you must be operating a small business (turnover <$2m) and use the car in your business, and not be claiming your Motor Vehicle Expenses under the cents per km method. Also, it has to be a NEW car, not second hand.If you bought a $30,000 car, you would get a TAX DEDUCTION of $15,000, resulting in a tax refund of $6975 at the highest…[Read more]

Calm down Garry. We see plenty of glowing first posts here so it's no wonder we get a bit bored and see through these type of posts. Pardon my cynicism Gaz, but you have provided a spirited defence of Lifecorp for someone who is not a plant.

Have a look at this. Also, Aussie Rob seems to be doing ok for himself, he just bought Jim Raptis' old headquarters on the Gold Coast. I'm sure there are people out there who have done Aussie Robs course and it worked for them, but you need to really do your research and own due diligence before spending the type of money Aussie Rob wants you to…[Read more]

bazmania wrote:
ScenarioCurrently live in own home with P&I mortgage.  (309k remaining)About to buy additional property (circa 750k) with IO mortgage. Intention is to rent out new additional property for a couple of years, then move in and rent out my current home as an investment property.What is the most effective way to ‘engineer’ this in or…[Read more]

Super will be less attractive after Tuesday. The rumours are that the tax deductible contributions for all will be halved, making it $25,000 for those under 50, and $50,000 for the over 50's, to 2012. Some changes also may be made to the Transition to Retirement arrangements. I know of a guy who, as he is still working part time and over 65, can…[Read more]

If the property is held in the wife's name (ie the wife owns the property) then the capital gain is in her name as well. It makes no difference how the loan was set up. CGT tax is paid at the marginal tax rates, and if held for longer than 12 months, there would normally be a 50% discount on the capital gain.

This article basically tells us nothing. From a statistical point of view, its and extremely small sample size. The fact is, as reported in the Age last week, house prices fell 3% last year in Melbourne, and is up about 1.6% for the first quarter in 2009.

mattnz wrote:
Thanks Scott,Hmmm, so let's say for example I sign a contract with a builder for $300k and a few weeks later I get a deposit of $20k from the eventual owner, for $20k more than I am paying for the property, but it won't settle for another couple of years. Does that mean I have to pay the gst on the $20k I have received in cash, or…[Read more]

Hi Blogs,I'm not sure about the run on the AUD, just because other countries and currencies are travelling worse than we are, and inflation being the least of our problems, but  I understand the logic behind your thoughts. I think there are competing factors, such as rising unemployment, low consumer confidence, recession on the negative side, an…[Read more]

blogs wrote:
Dan-tell me, what effect do you think another $40 BILLION floating around the economy will have on inflation? The effects of this and the recession are still to hit…give it time, you will see….Then add in increased taxes (well the government does have to pay for this massive loans somehow..) and a increase in interest rates (to…[Read more]

Of course interest rates aren't going to stay at these lows forever, but  I can't see them rising in the near term, because of increasing unemployment and lower consumer confidence. Inflation has been decreasing steadily and is now in "the RBA band". Maybe I'm getting cynical in my old age, but everytime I hear an economist talking about house…[Read more]

There will be some CGT payable on the house, for the portion it was used as an investment property. Before you rent it out, you should get a valuation.