Daniel,In some circumstances – yes – it may be better for people to move out of their PPOR for a period of time and rent due to the additional tax benefits.  However in reality there are a lot more reasons and complications not to do it (finding tenants, being a tenant again yourself, is the property you are renting as good as your PPOR etc).  I…[Read more]

Hi t-dorgDon't get too caught up with all the technicalities and wording of how the NRAS incentive works.What you really need to know is that your SMSF will be the beneficial owner of the property and hence will receive the all the taxation and incentive benefits.  As with your previous SMSF purchase the entity which 'holds' the property title…[Read more]

Hi Cath,The previous comments are on the right track.You can utilise the monies in your SMSF as the deposit on an investment property – and it is a superb strategy if you have support from people who know what they are doing in terms of the structure and getting the loan across the line. What you really need to know is that in general, your SMSF…[Read more]

Scottdog,Read read read and then read some more.Grab a copy of API magazine (Australian Property Investor) when you can and read the stories – focus on the real issues – which are sometimes glossed over.You will need good advice once you get started – find a good tax accountant and a good conveyancing lawyer – ask around places like this for…[Read more]

Terry has it right.If he is still an Aussie resident for tax purposes then he declares all worldwide income (i.e. including PNG income with a credit for PNG tax paid).Negative gearing runs as normal.Your accountant should be able to confirm all this and give specific estimates as they will know more detail about your personal tax situation.Good…[Read more]

As Dan42 said, any returns will be amended to claim the additional tax deduction for the body corp fees.Exactly who claims the deduction depends on who was the legal owner at the time the expense was incurred.There might be a situation in the year the divorce settled where the deduction is 50/50 for part of the year and then 100% in one persons…[Read more]

Kuradji – can you give us an update – how has this purchase progressed?

Jps,Have you received advice in regards to whether your husband will be an Australia resident or not for tax purposes?This will have a lot to do with giving an appropriate answers.Cheers

Excellent response Terry,If I can put a practical application on your suggestions:- I would utilise a unit trust structure- I would set up a company to be trustee of the unit trust with both yourself and your mate as the directors and shareholders- Miike to drawdown on your equity as a separate loan and use the funds to purchase units in the unit…[Read more]

Hi guys,To make the matter even more confusing, I have also seen another type of 'property trust' which basically is a discretionary trust where the deed has built in loan agreements that apparently shift the deduction for the interest from within the trust out to the individual.Again, as an accountant I am typically not happy with these type of…[Read more]

Yeah – this is a pretty common question.Lets look at the options:1. Buy in your personal name:– if negatively geared then you will reduce you taxable income and save you 37 cents in the dollar (plus 1.5 cents medicare) for every dollar the property is costing you – this is good and could even make it cash flow positive once you take into account…[Read more]

Hi Cookie Monster,Well, assuming the depreciation relates to the investment property, then the expense is connected to the receipt of rental income – so the accountant has it right – it definitely goes with all the other expenses relating to the property.Where else do you think the depreciation would go?Would you like me to tell you exactly what…[Read more]

Hi Winnie,I have heard of them.Found some more info here also:http://www.somersoft.com/forums/showthread.php?t=60754Good luck with your research.

Great info about the anti-detriment payments L.R.Pity you have to die to access them!But seriously, estate planning is important in a SMSF – especially with lumpy assets such as property.The anti-detriement reserves are a superb gift to give to future generations. The tax deduction (and more importantly the tax loss it creates) can amount to…[Read more]

Yeah – you pay the 1.5% medicare levy – which is different to the medicare levy surcharge which is on top of that.As per Mr5o1CheersEvolve

First of all – congrats on getting your business cranking and generating a nice juicy profit AND excess cash flow!Generally, you should keep your business interests and your investment assets legally separate.  This means buying any assets in a different name i.e. a different trust, super fund or a beneficiary / spouse who is not a director of…[Read more]

Good answers provided TerryChoosing an appropriate structure for a particular investment property purchase is a very difficult question because, as Terry pointed out – there are so many factors to consider!  Good topic for a sticky post. You can always double check what is best by seeing an accountant or two – most of them will not charge (or…[Read more]

Dan42 wrote:
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.

I have seen way too much of this in my professional career thus far.  Trying to prevent honest hard working people from getting ripped off is…[Read more]

Thanks for additional info Number8 – it does put a totally different spin on what you have said and it looks like I did something I typically don't like doing – making an assumption!Thanks for giving some constructive criticism and acknowledging that in certain areas I do personally provide value and answer a few questions here and there – rather…[Read more]

Wow – reading this thread has been a lot of fun.I just want to point out that this is a property investing forum – so a lot of the post / comments are from people who are into doing it themselves via property.Before I comment, I will disclose a few things about myself:- I am a chartered accountant and SMSF specialist adviser (SPAA) – I also have a…[Read more]