Why People Sell?
- Poor location
- “Bad” Tenants
- Finance incorrectly set up
- Cost of holding
- Need to sell to access equity
- Use other people’s money
- Build a portfolio
- Never, never, sell
- Harvest the accumulated equity
Maximising tax REFUNDS from investment property
Many property owners are losing potential tax refund $ by failing to take full advantage of a property’s tax depreciation potential. An often overlooked method of obtaining tax refunds, property tax depreciation is available to any property owner who obtains assessable income by way of rent or operates a business from a property.
What is a quantity surveyor?
A quantity surveyor provides construction cost consultancy services to various individuals and organisations. A quantity surveyor is equipped with construction costing skills that enable them to specialise in pricing building costs. Quantity surveyors provide investors and owners of property, along with real estate agents and accountants with the following services:
- Capital allowance tax depreciation reports
- Replacement cost estimates
Quantity surveyors also provide financial institutions, developers, builders and architects with the following services:
- Construction cost planning service
- Assessment of work in progress
- Forecasting & reporting
The Taxes to Consider Before you purchase a Rental Property
- Income Tax
- Land Tax
- Capital Gains Tax
- Stamp Duty
Income Tax is the tax you pay on your taxable income.
Land Tax varies from State to State and depending on the structure you choose.
Capital Gains Tax is the amount of tax that needs to be paid when you sell a property.
Stamp Duty – different in every State, it is the duty we pay to the Government when purchasing a property.
Rental Property Losses – Tax Implications
Buying property in a Trust versus buying in your personal name:
- Any net loss incurred from holding an investment property in your personal name can be used to reduce a person’s taxable income, hence increasing your tax refund or reducing your tax payable.
- The property is potentially exposed to creditors.
- Ability to distribute income of the trust between the beneficiaries in the most tax effective manner.
- The other principal benefit of the owning of assets through a trust is that no one beneficiary has any claim to the assets of the Trust, and therefore a Trust is a means of owning assets for the purposes of asset protection.
- Trust losses cannot be distributed to beneficiaries; the net losses can only be carried forward to be offset against future income.
- There is a cost involved to set up the structure and higher ongoing costs.
In determining whether to utilise a Trust structure for the purposes of buying a rental property, it is necessary to give consideration to a wide range of issues, which are specific to each individual’s particular circumstances.
Please contact us to discuss your situation.