All Topics / Help Needed! / Friend Moving In

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  • Profile photo of runnymanrunnyman
    Participant
    @runnyman
    Join Date: 2012
    Post Count: 4

    Hi all,

    I wondered if anyone was able to help me. I have a friend who will be moving in with me 1st July and occupying two of the four bedrooms in the house (one for himself and one for his daughter). I intended to live in this property for another two years (and turn it into an IP) whilst saving for another house so this arrangement will help me save more money in the interim. I was just wondering for tax purposes whether I would be simply applying 50% of the property outgoings (interest/depn/rates/electricity etc) against the rental income when assessing the taxable income on the property? I was also wondering what would be the situation if the rent I was charging was not quite market do I just assume in the calculation I am receiving market rent even if I am not actually receiving market rental? Are there any other items I need to consider under this type of arrangement. If anyone had any helpful pointers that would be greatly appreciated.

    Runnyman

    Profile photo of TerrywTerryw
    Participant
    @terryw
    Join Date: 2001
    Post Count: 16,213

    You should probably charge roughly 50%, some work it out on floor area, but 2 bedrooms out of 4 works out around 50%.

    If you are charging market rent you could claim this x% of expenses, but if you are charging 80% of market rent it would be more like 80% x 50% of expenses.

    Keep in mind you will lose the full CGT exemption if income earning.

    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

    Profile photo of thecrestthecrest
    Participant
    @thecrest
    Join Date: 2004
    Post Count: 992

    Would they get 50% of bathrooms as well ? would they have equal access to everything else ? Garage? Storage?
    Good luck
    Cheers
    thecrest

    thecrest | Tony Neale - Statewide Motel Brokers
    http://www.statewidemotelbrokers.com.au
    Email Me | Phone Me

    selling motels in NSW

Viewing 3 posts - 1 through 3 (of 3 total)

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