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Rob G.
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@rob-g.
Join Date: 2010
Post Count: 70
November 22, 2011 - 7:03 am
pale ale wrote:
Only myself and one other employee have purchased our own homes
If this is your 'home' then you might not be able to access the LAFHA by definition.
Cheers,
Rob
Rob G.
Participant
@rob-g.
Join Date: 2010
Post Count: 70
November 22, 2011 - 2:26 am
pale ale wrote:
Thanks if anyone can enlighten me on the normal protocol.
It is up to you to get financial and taxation advice about the best combination of salary and benefits that your employer is prepared to offer as a salary package.
The LAFHA has a number of tax benefits that your employer might pass on.
However, it sounds like you chose a different option.
It is not up to your employer to provide advice nor compensate you for any choice you made that was not optimum for your circumstances.
Cheers,
Rob
Rob G.
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@rob-g.
Join Date: 2010
Post Count: 70
September 21, 2011 - 12:06 pm
Most likely stamp duty on acquiring your mate's share, the amount depending on your state.
If joint tenants, both of you have a CGT event when the joint tenancy is severed.
You may get some main residence exemption if you occupied it for some of the time.
Better get some detailed advice from an accountant because joint ownership is complex for tax.
Cheers,
Rob
Rob G.
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@rob-g.
Join Date: 2010
Post Count: 70
September 6, 2011 - 1:03 pm
AllanP wrote:
Hey all im new to the forum here so hope this is in the right section.
My partner and i purchased a house in Adelaide at the start of 2010 and lived in it for 12 months while renovating it. We then moved to Brisbane and now rent the property out. We have a few questions about the tax side of things.
Our accountant told us that we will not have to pay capital gains tax if we sell it within 6 years because its our principal place of residence. How can this be classed as our principal place of residence if we now rent a house in Brisbane? Is he trying to pull a dodge here?
He also said that if we get a depreciation report done and claim depreciation we will then have to pay capital gains tax when we sell the house.
I guess what im getting to here is im assuming that we will have to pay capital gains tax regardless because we do not even live in the same state as this property an we rent it out which to me seems like it would be classed as an investment property right? Well if this is the case we may aswell get a depreciation report done and get some extra tax money back
Also how does the tax work when it comes to interest. Does the interest we pay over the year come of our taxable income?
Sorry for the long read i appreciate any help. I have been to the ATO website and i cant get a clear answer it seems to contradict itself and leaves me puzzled.
You may get up to a 6 year exemption on an absence if you had initially established the home as your main residence.
If you move back in before the 6 years expire or otherwise sell then it will be entirely exempt. Don't feel you have to sell !!! Don;t forget the 50% discount and the fact that the tax is deferred until disposal.
Any depreciation deductions on the capital works (buildings, etc.) will reduce the CGT cost base. However, to the extent it remains exempt while rented then there will be no CGT anyway !!
Depreciation deductions under capital allowances (e.g. hot water, oven, carpets etc.) will not affect the cost base for CGT.
Cheers,
Rob
Rob G.
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@rob-g.
Join Date: 2010
Post Count: 70
August 11, 2011 - 10:30 am
If the PPOR is rented for the first time, you would likely need to get a market valuation of the PPOR for CGT purposes anyway. You could get all your schedules done at that date for convenience.
Cheers,
Rob
Rob G.
Participant
@rob-g.
Join Date: 2010
Post Count: 70
August 2, 2011 - 10:52 pm
Money borrowed to pay interest on your investment loan would usually be an allowable deduction.
The problem is the temporary redraw and parking with private funds (in the offset account) causes loss of traceability.
e.g.
$10k private funds in offset account.
$10k interest payment is due. Redraw the day before and park in offset account.
When you take the $10k out of your offset to pay your interest, this will consist of $5k private funds already in the offset plus $5k sourced from you IP loan. You CANNOT CHOOSE which portion you withdraw.
So your IP loan has increased by $10k (redraw), but only $5k of that principle is related to an income producing purpose. The other $5k remains in your offset account to replace the savings used from the latter account.
Over time, your IP loan will increasingly become mixed up with private purpose funds.
Regards,
Rob
Rob G.
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@rob-g.
Join Date: 2010
Post Count: 70
August 2, 2011 - 11:55 am
This thread is totally confusing.
Maybe some terminology is incorrect, however I still cannot see the fund flows and purpose.
Maybe some hypothetical accounts & transactions as examples ?
Cheers,
Rob
Rob G.
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@rob-g.
Join Date: 2010
Post Count: 70
June 30, 2011 - 10:30 pm
fredo_4305 wrote:
Hi all, I am expecting my rent for the last fortnight to hit my account tonight or tomorrow morning. If it hits my account after midnight June 30 does it get included in the next financial year?
From your tenant or from your PM ?
Cheers,
Rob
Rob G.
Participant
@rob-g.
Join Date: 2010
Post Count: 70
June 30, 2011 - 3:53 am
Ishtvan051 wrote:
My main interest is for the purpose of creating a last will and testament which is equivalent to a binding nomination.
If you spend some money creating a SMSF then you are able to effectively create a set of death benefit instructions in the SMSF trust deed in your will which dont have to updated every three years as in the case of a standard binding nomination.
That was my understanding of it all according to the youtube video on my first post….
Oh, I see, So the SMSF requires you to transfer all your money out of your commercial super funds into a single fund held by the SMSF trust which the trustee (yourself) manages.??
I suppose also as in any other trust upon creation you would make yourself appointer and then appoint yourself as trustee
A binding death benefit nomination does not necessarily lapse after three years for a SMSF.
A super fund is only able to distribute death benefits to SIS dependants or your estate.
Whilst a SMSF is a trust, it is a statutory one with very comprehensive legislation and severe penalties for a breach.
Cheers,
Rob
Rob G.
Participant
@rob-g.
Join Date: 2010
Post Count: 70
June 23, 2011 - 4:04 am
Ishtvan051 wrote:
When deciding how much is relevant to employ me as a bookeeper what would be a good resource for deciding how much would be appropriate to funnel through a trust?
I mean I know there are many websites outlining average salories by hour in various roles but is there an official one which is perhaps run by the government giving a ballpark figure…?
You seem to have reached the conclusion that the PSI rules and/or Part IVA do not apply to you ?
Where caught, there are no permitted deductions for paying an associate to do clerical/admin work.
Where not caught, the ATO reserves the right to apply Part IVA in cases where a personal services business is also being carried on.
Just because a Government dept is your partner's "client" does not mean that PSI rules will not apply. Your partner should already have got advice on this because it affects both parties regarding deductions, PAYG withholding, super, etc.
Cheers,
Rob
Rob G.
Participant
@rob-g.
Join Date: 2010
Post Count: 70
June 6, 2011 - 12:45 pm
fredo_4305 wrote:
I am in the process of subdividing a property. Can the soil test and Surveyor plot be claimed agains the existing dwelling?
If you are an investor, it would go into the cost base … apportion on a reasonable basis between blocks.
If you are in a profit making scheme that is less than a business, gains/losses on land will be subject to CGT … as above.
If you are in a business of developing land, the land development costs may partly form the cost of trading stock.
Keep a record of any GST paid in case you are deemed to be conducting an enterprise or otherwise dealing in new land.
We cannot possibly be sure of your circumstances on so few facts.
That's why the recommendation to see an Accountant who can look at the whole circumstances and your options.
Cheers,
Rob
Rob G.
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@rob-g.
Join Date: 2010
Post Count: 70
May 21, 2011 - 11:19 pm
You don't have to be in a business to claim personal super contributions.
However, if you have some employment income (e.g. subject to SGC) then there is the additonal tests to fulfil.
Cheers,
Rob
Rob G.
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@rob-g.
Join Date: 2010
Post Count: 70
May 19, 2011 - 1:18 pm
There is no freehold in the ACT.
Don't even bother to ask why … the whole state is another unhappy political compromise that reads better than a Monty Python script.
Cheers,
Rob
Rob G.
Participant
@rob-g.
Join Date: 2010
Post Count: 70
May 15, 2011 - 12:35 pm
TD 94/89 paragraph 3.
Cheers,
Rob
keiko wrote:
I am selling one of my investment properties
Now the contract date was last week and settlement date is in August
I would like to know if I will be paying capital gains tax in the 2011 financial year as the contract date was in this financial year or will I pay CGT in 2012 financial year as that is when settlement will be?
Rob G.
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@rob-g.
Join Date: 2010
Post Count: 70
May 9, 2011 - 7:37 am
A) Capital … initial repair even if deferred
Maybe capital if the extent of repainting was beyond required, i.e. if only patches required repainting. Also, if you used a more durable weather resistant paint etc.
Its a matter of reasonable judgement, but if choosing a different colour forced you to repaint the whole house then this may indicate another purpose other than a mere repair.
TR 97/23
Cheers,
Rob
Rob G.
Participant
@rob-g.
Join Date: 2010
Post Count: 70
April 15, 2011 - 10:25 am
CheapAtHalfThePrice wrote:
Hi All,
What are the extra clauses that experienced investors have put into their Discretionary Trust Deeds that are above and beyond what you would find on a standard deed from cleardocs or law central?
I've just bought/read Trust Magic by Dale Gatherum-Goss (revised in Feb 2011) and would highly recommend it to anybody looking at trusts. Worth every cent. (Family Trusts by R E Renton was also good. As was Saving Tax on Your Investment Property by Noel Whittaker and Julia Hartman.)
In his book, Dale describes a clause in one of his trusts is:
The ability to pay income to the parent or guardian of any such beneficiary – for example towards maintenance, education advancement or to the benefit of the beneficiary
So. . . . What other clauses or topics have people included/found useful that are not included in the standard internet deeds?
Thanks,
Robert
State Trust Laws usually include these clauses where a deed is silent.
Randomly tacking in clauses that seem like a good idea in isolation can have unintended consequences.
That is why it pays in the long run to actually have an interview with a qualified lawyer to custom draft the deed to suit current and anticipated scenarios including estate planning etc.
Cheers,
Rob
Rob G.
Participant
@rob-g.
Join Date: 2010
Post Count: 70
April 5, 2011 - 10:41 pm
Adz123 wrote:
If I purchase a property in my own name and live in it for 12 months then sell it and walk away with a $100k profit (after performing a $60k renovation) am I liable for CGT? (Note: The intended purpose of this property is to produce a profit)
If the ATO knows your purpose and determines it is a "business", you are up for full income tax plus perhaps GST.
If it is determined to be a "profit making scheme" then CGT is the primary code for land and you get the 50% discount. But perversely, the concept of an enterprise for GST is much wider than a business.
Main residence exemption and/or discount is only available if CGT applies. No CGT will apply to the extent that you are assessed under another provision (no double tax).
Make sure your Accountant knows your intention.
Cheers,
Rob
Rob G.
Participant
@rob-g.
Join Date: 2010
Post Count: 70
March 20, 2011 - 9:41 pm
JacM wrote:
Hi all,
I am wondering:
If I were to purchase a powertool such as a drill, sander, etc… for the purpose of being able to maintain and improve my IP, would the cost of purchase be a deductible expense? If so, does it come under maintenance and repairs, or capital improvements?
The same question applies to the accessory parts such as drill bits.
Please note; my question is relevant to a property held in my own name (ie not a company or trust or SMSF).
Thankyou in advance!
JacM
The tools and accessories (as opposed to any consumable items such as sanding discs) would be capital.
They may be depreciated, and a deduction claimed for the taxable use proportion of their decline in value.
To the extent they are mainly used for earning income other than from a business then any items costing no more than $300 may be depreciated 100% in the year of purchase.
Cheers,
Rob
Rob G.
Participant
@rob-g.
Join Date: 2010
Post Count: 70
March 9, 2011 - 9:42 am
Sorry, don't know anybody.
You might not have a mess … you just have not provided sufficient information to know really what is happening.
But it can't hurt to get a second opinion from another Accountant in Adelaide.
Cheers,
Rob
Rob G.
Participant
@rob-g.
Join Date: 2010
Post Count: 70
March 9, 2011 - 2:01 am
sml wrote:
I am buying my stock from overseas so there is no GST included in my purchase costs.
You didn't specify if your imported stock is GST-free, input taxed or otherwise eligible for customs concessions.
The importer is normally liable for GST regardless of whether registered or carrying on an enterprise.
The threshold test is based on both 'current turnover' (last 12 months to the end of this month) and 'projected turnover' (12 months starting this month).
If your current trunover is >= $75k but you can satisfy the ATO that your projected is below then you don't need to register.
BUT if your projected turnover is >=$75k then you need to register. The ATO would be interested in what your projections were a year ago based on the fact that your actual is $85k.
Cheers,
Rob