G'day all…
If we decide to rent out an IP to a family member to avoid expensive management fees, what would be the minimum requirements in terms of receipts the tax office would need for the financial year? Any help would be appreciated. Cheers
tuggerwaugh
Hello tuggerwaugh
I rent one of my IP's to a family member and don't use a PM.
They just transfer the rent into my account each month, clearly marked as rent for this IP and this seems to be sufficient. I haven't had this checked by the ATO but my accountant is happy with this arrangement.Naturally you need to keep the documentation for all outgoings (insurance, rates, repairs etc ).
As long as you rent out at market value you shouldn't have a problem.
I didn't ask my family member to sign a lease but it has been suggested on this forum that you should, even if it's only a very short one, to protect both parties in case of disputes.Maybe you can search the site for more posts on this topic.
Hope this helps
ElkaYes I would also recomend a lease even only for the simple demonstration of a commercial agreement for taxation purposes.
good onya…thanks for those replies…something to think about. Are there basic lease contracts you can purchase as a program or 1 off, or is it easier to just write your own up? Cheers
tuggerHi all.
New to this forum. Just purchased an IP in Qld Gold Coast and have been researching self management. You can download all the forms you need from the rental bond authority in your specific state, the RTA in our case, http://www.rta.qld.gov.au
Hope this helps.
Vince
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