Phil,
It starts when you buy the land.
Have just completed such a project and the accountant confirmed its the land purchase contract date that determines the CGT trigger date.

Julia: you must be a walking ATO dictionary !!!
Amazing……

KP

Thanks for the info Richard.
I understand stamp duty for the wrapper is triggered prior to settlement.
I meant as far a the wrapee is concerned, when do they pay stamp duty…on entering into the terms contract, or when they finalise the terms contract or refinance(ie.. when their name goes on the title deed)
Thanks,
KP

Oh Dear,
I wasn’t going to buy back into this..and neither were you Monopoly (bad gurl)
So from your example Kay, a gross taxable income of $100k reducing to $20k (difference of $80k) results in a tax difference of $40k to $2.5k.( tax refund of $37.5k)
Therfore you have to fork out anything up to the $80k ( admittedly less with depreciation…[Read more]

hsmedia,
Why do you want to sell the properties ?
Is there a problem with them ?

KP

I am not an agent, but I think its a bit one sided and even harsh to say that the agent does nothing ( house sells itself)
I too, have an IP for sale (90 days, no result)
and the feedback I am getting from various agents is that there are only 2 things which determine if a property sells or doesn’t sell.
One is no doubt the price, the other is the…[Read more]

Hi SPT,
Seeing as you have the cashflow to fund the debt, why not consider buying old house on block zoned duplex.
Then build two (or add one if you can retain the existing house)
You then have choice of keeping both for rental or keep one sell one to reduce debt.
You end up with new property which will have minimal maintenance costs and maximum…[Read more]

Thanks Monopoly,
I thought it made sense.
Kay H, can you clarify what you mean by “you get back more in a lower tax bracket”
Its a serious question, as I don’t understand what you mean… unless I have nissed something..

KP

DItto to Acey’s reply.

PS.. have you jumed ship from the other forun Acey ?

KP

Mellis…
Can you add a First Home Owners Grant to it ?

Just a thought.

KP

Unless your tax deductions are “non cost” deductions like depreciation for example, then it is self delusional to say that reducing the tax you pay such that you end up in a lower tax bracket is effective.
You are in effect spending a dollar to get 48.5c back in the top bracket, and spending a dollar to get back even less in the lower tax…[Read more]

Yep Monopoly,
I agree the 7% is a good rate but it is an exception and not the rule.
Standard seems to be 8 to 8.5%
And you still cop all the extra costs which seem to be included in the management fee in Vic, etc.
Thats the annoying bit as far as I am concerned…

Got it…
Thanks Julia

Someone forgot to tell WA that the property market is cooling. (maybe it really does stand for Wait Awhile)
Prices have slowed down but have not retreated, and according to 3 agents I have spoken to, there is an acute shortage of listings….40% below average…
So far its business as usual….maybe our crash comes later…

KP

I,m like you Helen,
I needed to understand the process…so I did one on my own. Had one minor hiccup which resulted in a delayed settlement, but beyond that it was a painless process.
In fact the vendor also represented themselves, so it wasn,t that big a deal.
Basically, four persons (two bank representatives, a purchaser and a vendor)sat…[Read more]

Hello Julia,
I too must be thick..
Can you clarify a couple of points pls:

You mentioned that income stream prior to the wrap contract is rent but post the contract is P&I repayment. if you’re on selling the property to a wrapee surely they would occupy once the contract was in place and hence the repayment will be P&i. When will it be rent…[Read more]

Thanks to all of you guys for the replies,
It still seems that there are a lot of “add on” costs in WA irrespective of the management fee % rate.
It seems that the inspections and ongoing services are included in the fee in Vic and NSW and elsewhere, and this fee also happens to be lower !!(excepting Tas of course)
I will be providing this info to…[Read more]

Thanks for both your replies,
So by “settlement” do you mean when the wrp contract is enterd into, or when the wrapee finalises the contract (pays it out or re finances it)
Also, when is stamp duty payable by the wrapee triggered ? At teh start of the wrap contract or only when the title is transferred into the name of the wrpee ?

KP

Traditionally, Perth has not been an “auction” market with most residential sales completed via private treaty.

Therefore, using auction results will not give you a good indication of the market at present.

The feedback I got from 3 agents this week is that the markt is still very active up to $250k with some resistane after $300k.

The resource…[Read more]

Thanks Yack and other for the response.
Its as I suspected…we seem to be behind the 8 ball in WA (and I suspect NT as well) with regard to fees and charges being at the top end of the scale.
I have to wonder why this is so ?
It can/t be due to a lack of competition.
Maybe the rents a much higher in Vic and NSW so that a PM gets a decent dollar…[Read more]

So based on this, you would think that the ATO would be pro wrapping as it eliminates the non cost deduction of depreciation being claimed on what is effectively an investment property !!

Another query Julia, how is CGT liability viewed by the ATO once a wrapee is in place ??

Dos this trigger the CGT expense since you will now have a contract in…[Read more]