The legisation regarding the FHOG is a little wishy washy. But there are some key factors to note. The logic behind giving owners the outlet to rent the property out first, is in the situation of the purchased property having a tenant. I know that people have discussed the fact that you must move in within 12 months, but that is not in the…[Read more]

Just to clarify, a superfund should it wish to purchase property must buy it outright as the SIS laws do not allow a superfund to borrow money.

Should a superfund borrow money, then it would be a non complying fund and the assets in your superfund would be taxed at 47%. Very steep penalties.

The quickest way to create wealth is to complete the PAYG variation form and receive your tax refund on a weekly basis, rather than a lump sum at the end of the year.

Your interest in your PPOR is a non deductable form of interest, so you want to reduce it as quickly as possible. Adding as little as $10 per week to your weekly repayments makes a…[Read more]

Grreg

I agree with Yack, I believe your friend is better off selling the apartment and keeping the property in the suburbs.

You will most likely get better growth in the suburbs especially if it is house and land, than an city unit.

Sometimes you are better off cutting your losses and starting again.

The body corporate is only responsible to common property, unless there is a by-law passed.

The strata schemes is governed by the Department of Fair Trading, if you have any questions they can help you to determine whether an issue is body corporate responsibility or the individual owners.

The executive committee of the body corporate must…[Read more]

Craig

Your wife is one of lucky few who are able to salary sacrifice private expenses, as she is employed by a rebatable employer. It is definitely a tax advantage for you.

Unfortuantely for the majority of us, we are able to take advantage of this.

DC

CraigC

I’m not too sure whether how your wife is better off. Does she work for a rebateable employer for FBT (eg non for profit hospital or club)? If she works for a rebatable employer then I say take advanatage of it. But if not then it may not be beneficial.

And what is she sacificing her salary for? Home repayment (private expenses) or…[Read more]

My understanding is that if your employer repays more than the total amount of interest charged on a loan, then the ATO will classify this as a principle repayment and fringe benefits tax will be assessed on this amount. As a result, if you are not paying tax at the highest marginal rate then you would be worse off.

Troy

Under NSW legislation, a discretionary trust which owns property is subject to land tax immediately, as it is not subject to the land tax exemption.

In the unlikely situation, that you have set up a unit trust, in these situations you would receive the land tax exemption. Most people do not set up unit trusts because it is not as flexiable…[Read more]

Can someone explain the reason why you would do what James Cameron has suggested.

From what I understand from his post, if he places the property in either a trust or company, he says that he will be taxed at a lower rate than his marginal tax. He seems to be suggesting that his property will be making a profit and paying some amount of tax. Why…[Read more]

If you are purchasing a commerical property, you should be registered for GST, as you would be able to claim the full amount of the GST when you lodge your BAS, as a result you would not get tax deduction as have not had any loss.

If you where not registered for GST when purchasing a commerical property you would end up paying an extra 10% for…[Read more]

To say that negative gearing is not a wealth building tool is silly. It is not for all, but should you be earning income in the top tax bracket, then it is highly desirable to negative gear to reduce you tax. Steve’s reasons for not negatively gearing are valid, but it must be remembered that the majority of people who have made money in property…[Read more]

Its Sydney’s skyline

Stamp duty on loans is deductable (generally) over 5 years.

Stamp duty on purchase on property is not tax deductable, rather it forms part of the cost base of your asset (for CGT purposes).

Yes I totally agree with Doogs and Mortgage Hunter.

Jason advice is not correct. It is a common trap for inexperienced investors.

For people who currently live in there own home and intend in the future to buy a new home and keep the old one as an investment property, you should consider getting an offset loan account.
In this situation you…[Read more]

The ATO is definitely aware of Instalment Warrants and infact has issued numerous product ruling on different types of Instalment Warrants.
These ruling explain how the Instalment Warrants are taxed.

So you check them all out on the ATO website.

IMO, based on your situation, so may be better off setting up a discretionary trust to house your future IPs. Must be positively geared properties though, as you cannot distribute losses from a trust.

A trust is a more flexiable investment vehicle than a company as you can funnel income to the most tax effective beneficiaries.

MJK

Yes, you are correct that, do not have to not have to register for GST if your rent are less than $50,000 per annum.

But if you did that, it would be very costly if you didn’t register for GST, as you would not be able to claim the GST on the purchase of the property.

To be able to claim the GST on purchase or use the going concern…[Read more]

You need to be a little careful if you apply for an ABN and then no trading occurs for three years.

The tax office will wonder why you applied for an ABN? As to apply for an ABN you must be running an enterprise/business.

The ATO audit review team may pick up, and consider visiting you to check you out which could be time consuming and costly if…[Read more]

Commerical properties are fine, except you must keep in mind the GST issues.

Prior to purchasing you need to apply for an ABN, and then consider buying the property as a going concern, which means that you will not have the pay the GST upfront.

Also you would have to lodge (quarterly) Business Activity Statements.