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Hi Welman,
I don't know much about that particular type of trust so in your case it would be best to speak to Chan and Naylor directly. I know they are one of the leading accounting firms in Australia who specialize in property, however I have no idea as to how their prices compare to other accounting firms.
Good luck
Hi Wealthyjvd,
Firstly, everyone's circumstances may be different, what I put below may not apply to you and it would be best to speak to your accountant.
To get clarity on your situation, what was your intention with the property? Were you intending to develop a property and hold it as an investment property receiving income for a number of years (capital asset) or were you planning on developing the property and selling it as soon as possible for a profit (trading stock)?
Regardless of the answer, you shouldn't have to go back and amend any returns just for this development, if you have other costs/ deductions that you need to claim, then fair enough.
If you were an investor, when the development is no longer viable/ you decide not to pursue any further, any costs that you have spent to date could be treated as a capital loss.
If you were in the business of developing the property with the aim to sell and make a profit, then these costs should have been carried forward as trading stock up until the development ceased. Once you cease the development then these costs are generally able to be written off.
As I mentioned above, a local accountant should be in the best position to discuss the above with you.
Hi Welman,
Trying to keep this simple, if you have a trust, the only way you can distribute from that trust is if there is a taxable profit in the trust. If the trust has a loss, the loss is carried forward to a future year to be offset against any taxable income.
If for example your trust has some say dividend (franked) income of $15,000 and a rental property (other income) loss of $10,000, so long as your trust deed allows the trustee to stream different classes of income being franked and other income, then you may be able to allocate any rental property losses (depreciation included) to certain beneficiaries.
Different classes of income included franked income, capital gains and other income. The trustee can allocate beneficiary A all the franked income and beneficiary B all the other income (in this case being the $10K rental property loss)
Hope this helps
