Just a tax question. I sold an IP in May, but now have just received some extra income (bond that was being chased up) in the new financial year! I was wondering do I have to claim the extra income when i do my 08/09 tax? It wont be claimed against any expenses,and I wont have owned the property for over 1 year, so doesnt seem to make sense. i havent come across this before when selling – any ideas?
thanksI'm not sure bond is technically income, as you either keep it to pay for damages, or it's given back to the renter, so it would probably have to be incuded in your 07/08 return to offset the cost of your repairs for the damages…
Check with your acocuntant though…
Hi TD,
I agree with mpertile. The bond money you received should be refunded back to the tenant or used to pay for damages. Its not income that needs to be included in your tax return.
Regards
Kevin
sorry, yes it is income because the tenants dissapeared and have not been found for over 6 mths so the money has been returned to me. I will call the ATO anyway, thanks for your help
Since you have kept the bond due to the tenants bailing instead of keeping part of it for maintainence then that may present a different sceneario. If there were cleaning expenses or advertising fees to relet the property then that would be deducted from the bond but any remaining part of the bond would then cover lost rent which is income and would have to be declaired in the year in which it was earned. I'm not an expert so check with an accountant to which period as the bond is held in trust until the default and I'm guessing you wouldn't of earned the money until it came out of the trust
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