All Topics / Legal & Accounting / Renting out shed on PPOR to a business

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  • Profile photo of swilly_84swilly_84
    Participant
    @swilly_84
    Join Date: 2011
    Post Count: 1
    April 22, 2013 - 9:46 am

    Hi

    We have a large detached shed on our PPOR that we are considering renting out to a business.

    I have looked on the ATO website re the implications of renting out part of the home and its implications for interest deductibility & CGT, and that the proportion of floor area of the home that is rented out is used to calculate this.

    Is a detached shed considered part of the home floor area for this purpose?

    Also, our house is a Queenslander with an enclosed space underneath which is carpeted. However it is not of legal height and not used as a living space – would this be considered part of the floor area of the home for this purpose?

    Thanks

    Profile photo of TerrywTerryw
    Participant
    @terryw
    Join Date: 2001
    Post Count: 16,213
    April 22, 2013 - 10:11 am

    Yes. Prob calculated on the land area used by the tenant.

    Also look into land tax. If in NSW you would lose the land tax exemption as well – but may still come under the threshold.

    Also consider the risks associated with this, and check up on your insurance.

    Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
    http://www.Structuring.com.au
    Email Me

    Lawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au

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