Hi all,
I need some clarification with cap gains. I’m not new to IP’s but still reeling over last years tax bill and have still lots to learn. Turns out I sold 2 properties in the one year, not 1 like I expected. For tax purposes the date of sale goes on contract date, not settlement like I thought. This was a double whammy because the settlement was on 5th July (the next fin yr)and also missed out on 50% saving on cap gain for having it over 12 months.
My question this time is about a spec home I’m having built. For cap gain discount purposes, does the 12 months begin on land settlement or contract date or when the contract with builder was signed? With all the delays with land title, building and maybe the sale, it might be worth while to hold for a little while or even put tenent in 6 months.You can get a copy of “Guide to capital gains tax” from the tax dept or go to their website.I got the copy.I find it better to read a hard copy than the screen all the time.All the answers are in there.If you get a bit confused then ring them up on 13 28 61.I find talking the problem thru is a lot easier than trying to decifer their guide.
They always offer to send me a copy each time I ring them LOL.But they are very helpful.
Russ.Hi Gaz-Ed,
I know this sounds harsh but……….
As you have already been burnt by either poor advice, misinformation or ignorance I would think that this really does highlight the need for professional advice to be taken when buying and selling property.
I consider an accountant’s bill an investment when it has the potential to save many dollars further down the line.
But in the meantime do as Russ has suggested read (or download) a copy of the CGT document off the ATO website as this will point you in the right direction.
Derek
[email protected]Property Investment Support Available. Ongoing and never stopping. PM welcome.
Derek, you took the words from my mouth . . .errr. . . .fingertips.
Forums like this one are a temptation to ask questions we would really only ask an accountant or a lawyer. Nothing wrong with asking to get a generic idea we then elaborate in detail with our professional of choice.
It is also true that there are many accountants out there who are Ok with standard employee tax returns that a monkey can do, but when it comes to investments and business dish out poor advice.
If your loss from the sale of your two properties was based on poor or no advise from your accountant, change accountant. Ask for a recommendation to a good accountant in your area, the folks here are very helpful in that regard.
I changed accountant when I realized it was I explaining him what to do, rather than the other way around.
All the best in your endeavors!
May God bless you
and prosper you.
Marc
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