Wayne,
Your cost base is made up of buying costs such as stamp duty and selling costs such as commission plus holding costs such as rates. Travel costs cannot be included in any of these.
The capital gain is the difference between the selling price and the cost base. You can deduct from this any capital losses on other assets then half it for…[Read more]

ttam,
Go to http://www.bantacs.com.au under tools you will find information on evaluating a rental property that will help you with the numbers. Also under free publications is a rental property booklet.

Julia Hartman
julia@bantacs.com.au
http://www.bantacs.com.au

Iboffer,
Be careful before you remove money from a super fund. While it is in super its earnings are only taxed 15% and CGT is only 10%. If you roll it over to a pension it could be tax free.

Maybe just Maybe consider setting up your own self managed super fund so you have more flexability in what you can invest in. But you cannot buy domestic…[Read more]

KJW,
There are a lot of buz words out there that I don’t understand my 18 year old son informs me. I have not read the book but my idea of a positive cash flow property is one that covers its own cost and leaves a little over in cold hard cash. Then of course the capital gain is the icing on the cake.
To work out a positive cashflow you need to…[Read more]

DNL,
The kids won’t cop CGT if the property is held in your name either. CGT only applies when the property is sold regardless of whether it is held by a trust or individual.
Nevertheless when you line up all the pros and cons you will probably find a discretionary trust is the best. Mainly because of the flexability in who pays the tax on the…[Read more]

Just Allan,
137/157 of the interest on the loan will be deductible against the rent. The other 20/157ths is only deducitble if the car is used to produce income.
If the car is not income producing I suggest you split the loan when you move out. Get a loan for $137,000 on interest only and another for $20,000 P&I. Concentrate on paying off the…[Read more]

DNL,

Sounds like your Accountant was talking about a superannuation fund as that is exactly the problem with holding property in a superfund. Maybe there was just a breakdown in communications. But regarding any you do own outright and don’t mind your money being locked away until you are 55 a superfund is the most tax effective place to keep…[Read more]

CrownOfGold,

Section 118-145 allows you to exempt it as your main residence for up to 6 years after you moved out as you can choose not to have your parents place considered your main residence. There is no time limit for tax purposes as to how long you have to live there but you must have moved in as soon as practical after settlement. TD51…[Read more]

g7,

The more frequently you do it the more likely you are to be considered in business by the ATO. This is not necessarily a bad thing. If you are going to turn the properties over in less than 12 months you will not get the CGT 50% discount so there is no benefit to you in trying to come under the CGT provisions. On the otherhand if you are…[Read more]

Just Allan,

Terry is correct but just a word of warning:
Traditionally, interest is claimable only on a loan where the actual money borrowed is used directly to produce income i.e. buy the income producing property.
It is dangerous to use a line of credit facility on a rental property loan when you will be drawing funds back out to pay private…[Read more]

Ambo72,
Repairs and Maintenance, not improvements are deductible. For example if the house needed painting when you bought it then painting it would be an improvement or if the house did not have a garden hose then purchasing one would be an improvement, therefore not deductible. On the other hand if during the time of your ownership the hose…[Read more]

UKman,

Assuming you are a resident of Australia for tax purposes you can negatively gear an overseas investment but only up to the total amount of interest payable. In ID2002/764 the ATO clearly states that, from 1st July, 2001 Section 160AFD allows the interest, borrowing costs etc. on an overseas rental property to be offset against Australian…[Read more]

Showmethemoney,

You should use the trust’s ABN never the company’s but you may need to use the company’s ACN to identify it.
Try to look at a trust/trustee relationship similar to being the executor of a will. If you were my executor and sold my house the contract would be in my name as that is still the name on the title deed. I can’t sign as…[Read more]

Scotty3

The quick answer is neither if the property is held as trading stock ie not subject to CGT. This is because the expenditure is revenue in nature not capital so deprn cannot apply. ID 2003/377.
If the sale is going to be subject to
CGT then the person providing the vendor finance, the sellor, can claim the depreciation because that still…[Read more]

Smethem,
Yes to your questions. If you would like more info on how non residents are treated, down load my Overseas booklet from the free publications page on http://www.bantacs.com.au

Julia Hartman
julia@bantacs.com.au

Regrow,

Tax is payable after you have done the tax return for the year you signed the agreement to sell.

Julia Hartman
julia@bantacs.com.au
http://www.bantacs.com.au

KP,

You would have to live in the new residence for 3 months and as long as there wasn’t more than 4 years between demolishing & moving into the new one and you didn’t use your main residence exemption on another house during that time you would get the CGT exemption on the new house. But no CGT exemption on the other new house.

Julia…[Read more]

Regrow,
You can only exempt a dwelling as your PPOR and only if you did actually live there even if only for a short period of time and you don’t want to exempt a house in Melbourne with your PPOR as you can only have one.
The catch here is the word dwelling. I assume you never got to build on it so it was just vacant land. If you had lived in a…[Read more]

Wayne,
If you have lived in this house and will be selling it as vacant land you will lose your main residence exemption completely.

Julia Hartman
Julia@bantacs.com.au
http://www.bantacs.com.au

Blondie,

Its not a book just a booklet but it is free. Go to http://www.bantacs.com.au to free publications and download the rental property booklet.

Julia Hartman
julia@bantacs.com.au