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Viewing 9 posts - 1 through 9 (of 9 total)
  • Profile photo of kauskaus
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    @kaus
    Join Date: 2004
    Post Count: 14
    November 5, 2010 - 3:47 am

    hi
    I think you may be little better with term deposit- reason from this year you can have 1000$ interest tax free . so keep  upto that amount in term deposit and over that amount in offset account.

    cheers
    sati

    Profile photo of kauskaus
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    @kaus
    Join Date: 2004
    Post Count: 14
    September 1, 2010 - 3:40 am

    Hi Scott
    First i am not an expert in this , still request you or others to explain

    Essentially, you are trying to work out how much you will need to sell the place for in order to make a profit ie $450 + $70 = $520k

    "Yes , that what i aim i know it is market which will determine price"

    Unfortunately, property value is determined by the market and it will only pay market value as the buyer does not care whether you have doubled or halved your money at the end of the day as they are not privy to that information.

    "Agree"

    Even if you are trying to determine whether you are going to be liable for CGT or not, this calculation is useless. All calculations must be made without consideration of tax implications as everyone's tax situation is different. You would also then have to factor in the effect of cgt into your calcs.

    "Yes I have stated in my original question"

    If this was an IP, then you will be liable for cgt if you sell for more than you purchased, conversely you can also make a capital loss.

    "Agree -sell  it for say 520K  if purchase is 450K , Profit 70k   and  apply cgt"

    So in answer to your original question "should the Holding cost be factored into the price when selling", the answer is no, as it up to the market to determine.

    "thanks, yo u answered this part, now as i said to James , IP may not good given the example i stated, which many people like me may not know or work out their holding cost, they see the purchase price and selling price, it could be higher (profit) or lower (loss). If your holding cost is recovered then i think it is good investment otherwise it is not. Can i say on papers it is profit but actually it is loss while taking into account holding cost. Is it correct statement?

    I would like to discuss with some one who is expert on my views as stated in orginal meessage.

     

    thanks

    satish

    Profile photo of kauskaus
    Member
    @kaus
    Join Date: 2004
    Post Count: 14
    August 31, 2010 - 2:50 am

    Thanks James – agree to your point but my point is Is calculation i stated is correct or not? If correct then it is difficult from investor point to make profit, i suggest people you bought say in 2003 on wards should work out and see whether it is worth on hold on. Answer to your point on formula i clarify as follow

    Purchase price including all cost >> 450K

    Calcuation formula for Holding cost is

    1 Gross Income  50000
    2 Net loss from property 20000
    3 Taxable income without property 50000 ,  
    4 Taxable Income with Property 50000 – 20000=30000     (3 – 2)
    5 Tax 30%(assume)   on 3  is 15000    –   without IP
    6 Tax 30%(assume)   on 4 is   9000      – with IP after taking out loss from Gross Income
    7 Tax Saving due to IP  15000 – 9000= 6000  –  ( 5 – 6)
    8 Holding Cost 20000 – 6000 = 14000             – (2 -7   ie loss – tax saving)

    thanks
    Satish

    Profile photo of kauskaus
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    @kaus
    Join Date: 2004
    Post Count: 14
    July 11, 2008 - 3:35 am

    Thanks a lot amsjerm and duskster

    Sati

    Profile photo of kauskaus
    Member
    @kaus
    Join Date: 2004
    Post Count: 14
    July 11, 2008 - 2:15 am

    Hi duckster

    Thanks for so quick response, cal you please clarify this bit

    "Income loss of $581 *.70 = -$406 (This is what you would be paying per week after tax refund of $174 per week"
    i understand $581 income of weekly loss but unable to get .70 and $174 one

    kind regards

    Sati

    Profile photo of kauskaus
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    @kaus
    Join Date: 2004
    Post Count: 14
    April 22, 2004 - 5:33 am

    Hi
    I borrowed 100% against by paid off property, and rent i am getting is $230 pw , i am not paying off any other’s loan . When i say $450 K , purchase price is $430 + other expenses like legal and stamp duty. In fact it is a old house. So loan as i said is $450K

    thanks
    Sati

    Profile photo of kauskaus
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    @kaus
    Join Date: 2004
    Post Count: 14
    April 22, 2004 - 5:11 am

    Sorry it is typo error, and surely discount should be applied

    Sati

    Profile photo of kauskaus
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    @kaus
    Join Date: 2004
    Post Count: 14
    March 31, 2004 - 4:33 am

    Just to add 2 cents!!

    Builders if are unable to off load to public , they sell it to Defence Houising at much higher price. Then Defence housing sell those properties with 9 + years lease. Has any one had any experience recently (last 1 year) in buying defence housing property.

    Sati

    Profile photo of kauskaus
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    @kaus
    Join Date: 2004
    Post Count: 14
    February 26, 2004 - 6:02 am

    Thank , now futher question is income from the rent and expenses will balance each other, in other words i will incus loss of interest in australia for the amount i borrowed , ie insterest on the amount. That interest i will user as negative gearing, Is that correct. In overseas it will not attract any tax as the rent is low.

    Please respond

    thanks

    Sati

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