Forum Replies Created
Hi Kylie,
If you are talking about the inspections done before buying, then theses are capital costs and not deductible against income. They are added to the cost ofthe property when you sell.
Not for investment properties, I'm afraid. It's only for 'active assets', such as goodwill in a business.
It's basically an exemption if you have had an active asset for 15 years, and you are retiring, and you satisfy the small business CGT exemptions.
Investment properties do not qualify as the asset is not considered an active asset in almost all circumstances.
Because your property was rented first, then you moved in, you would pay CGT on the 10/13ths of the capital gain. x 50%. For the 6 year rul exemption, you must have lived in the property first.
Hi Myra,
Great first post…..
Hope you stick around to tell us what courses we shouldn't do, but I won't hold my breath.
Generally you would go back and amend the previosu four years tax returns, rather than claiming all four years expenses in the current tax return.
The claim depends on who owns the asset. If the divorce meant that one party took over the asset, then they get the deduction.
Steve Keen has no idea.
MrsC wrote:Thanks. I think i will go down the accountant route.Following on from this, any views on whether the ITP's and H&R block people are any good for this? When i call other practicing accountants they bad mouth these organisations. But surely a lot of people still benefit well from their services…
I think it depends on who you see at these organisations. They are cheap, and the staff are generally not as experienced as CA or CPA firms. The problem is they usually do the basic returns, and their training is geared towards these types of returns.
I'd say yes for two reasons. If you get it wrong and you under pay CGT, then the ATO can apply penalties and interest to the shortfall. (That's if they find out)
On the other side, an accountant will work out the amount of the capital gaijn, and may find amounts that can be added to the cost base that you may hafve missed, reducing the amount you thought you would have to pay.
Get an accountant.
Intrigue wrote:Owe okay thanks Terry,So perhaps the contract shows the value @ $138,000 and the deposit of $80k. Upon settlement I pay the balance.
I pay stamp duty on the total value. This maintains my value and aids future CGT issues.Do I still need to declare this $80k as income – as I am not being paid it. Would I have to decalare it as a CGT event?
Sorry for all the questions, tax is a new area for me and our local tax people do not seem very clued in.
Depends, is the $80,000 a business debt? If the $80k is a debt owed to your business for work you have provided, then it will most likely be income in your hands, and assessable. If it's due to the sale by you of an asset, then it may be assessable under the CGT rules.
Whether it's income or capital gain or private really depends on why the amount is owed.
Reginald wrote:Hi,I just wonder do we have property capital gain tax deferral in Australia. It happens in USA.
It means could we defer the capital gain tax if we take the profit from the last investment property to buy the next investment property?
Regards,
Reginald
No I'm sorry Reginald, this doesn't applyh in Australia to property. There is CGT 'rollover relief' for certain assets, but this section does not apply to investment property.
Hi Theresa,
I just sent you a PM. I'd be happy to answer any questions you have, or provide you with more details if you wish.
Dan
Terryw wrote:Stamp duty is $500+ in nsw, but may be nil in other states.Wow, 500 bucks stamp duty!
There is no stamp duty on trusts in SA.
Hi Theresa,
If your rental property information is prepared by you on a spreadsheet, then $1300 seems high. Are you a salary earner, or are you self-employed?
Generally, the better your information is, the less you will be charged, because it takes the accountant less time, and the accountant will sometimes charge a 'annoyance markup' if they have to dig through receipts and untidy paperwork.
But for two properties with a spreadsheet record, plus a salary with a couple of deductions $1300 is high. We have charged less than half of that for a tax return with similar components. But it really depends on how good your spreadsheet is.
crusty wrote:Well what a disapointment that turned out to be badger. I thought maybe your were a clever investor. I guess you just dont know what you dont know. May be you better read some more books. If you are as smart as you pretend you wouldnt be paying CGT or selling costs , especially if you bought quality investment property in the first place. You should get at least 10% growth and 4% yeild. Use low intrest rates in the UK to levearage in to the UK market with a 1million deposite. To sell a property last year wasnt very smart there was no real down turn only good buying opportunities. Also if your so smart you would know the fx rate is not an issue as it can be hedged. also I dont consider putting money in to super a smart move perhaps it is ok if it is self managed , but it is too restrictive and the fees are too high. If you property prices are falling obvoiusly you were not smart enough to buy the right investment grade property , it is still growing strongly. Property is usually at least a10 year investment why puy a heap of property if you plan to sell it after less than 4 years, must be bad investments and you cant pay for it. That is the only reason you would sell property. Your strategey seems very unsophisticated to me.Crusty, if Badger is moving back to the UK and will no longer be an Australian residenrt, then he has to pay CGT on his Australian properties, whether he sells or not.
Seeing as you are so disappointed with Badger, perhaps you could explain your philosophy and current financial position. Do you have $1.3m of equity available to you?
number 8 wrote:Let me say, talking and making a difference in the life of Mum and Dad Australia is a joy. I love breaking down financial walls and restraints to show people how to save a dollar. But like I keep saying to my family and friends it is difficult to charge someone on a pension, or with two children and husband has left etc etc.
This is the issue the industry will have when the commission taps are turned off. One way or another, the client pays for the advice, at the moment it is through the fee structure of their superannuation or managed funds investment. Charging them directly for advice is a more honest and open way of doing it, and it's the way other professions charge their clients.
Hopefully the banning of commissions will weed out some of the rogue operators, and stop mum and dad Australia being placed into businesses like Westpoint and Fincorp, and losing their money.
kylieandronnie wrote:Do i claim buying costs such as stamp duty, buyers agent fees, loan set up fees in my end of year tax?
Or are these just claimable when you sell?Stamp duty and buyers agent fees are added to the cost, and in effect claimed when you sell.
Loan set up fees are claimable in your tax return, but over 5 full years. They are not all claimed in the current year.
Hi Terry,
From s40-65 and s40-75, I agree, it would be a taxable supply. But I think it would only be a taxable supply if you are registered, or required to be registered for GST.
I think intention is relevant, in that it shows there was no business of development. The GST Act requires you to be registered if you are carrying on an enterprise in Australia with a GST turnover of at least $75,000. I would say Jess is not carrying on an enterprise, so there is no need to register for GST.
So it's a GST sale, but there is no requirement to pay any GST as Jess doesn't need to be registered.
Dan
I can't remember Gerry Harvey complaining when everyone was spending their 900 bucks in his stores buying Ipods and plasma tv's. My personal opinion, we need to take what Gerry Harvey says with several grains of salt.
No matter how bad Labor are going (and it has been pretty ordinary the last year), they will never be as bad as a government led by Tony Abbott. John Howard was described as a throwback to the 50's, Abbott would also be a throwback to the 50's. However it would be the 1850's.
The exit fees from the bank are a cost of borrowing, so would be included in the rental expenses, as borrowing costs.
I assume it was your PPOR from day one? If so, the cost base is $435,000 (per the valuation)
The sales price is $428,000 less agents commission, conveyancer etc.
