[AmandaBSParticipant@amandabsJoin Date: 2005Post Count: 549]

May 10, 2007 - 7:19 am

Yes I'm also guilty on not visiting for some weeks as I found the new forum hard to use.  Thanks to Steve he's listened to our comments and has made some great changes recently.  Thanks for bringing back the sections, time/name of last post & I love the new feature where you can mouse over the thread to read the topic.  Well done Steve and many thanks for providing us with this great forum free!!

[AmandaBSParticipant@amandabsJoin Date: 2005Post Count: 549]

May 10, 2007 - 7:13 am

The thread you refer to is working out how much profit you've made on a property after allowing for the negative cash flow over the years.  This is not part of the CGT calculation.  This example has been done to show you that when you sell a property your "profit" is not just sale price less purchase costs,  but that you should also be taking into consideration the loss made on negatively gearing it over the years.  This negative gearing loss is of course tax deductible in your tax return each year,  but you can't double dip!!

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May 10, 2007 - 7:06 am

Here's an extract of a document off our website about Subdividing that may be of help:

What is Subdividing?
Subdividing is when a piece of land is split into two or more pieces (ie separate lots). The process is controlled by the local Council. Planning codes and procedures vary significantly between Councils and also between States and Territories, as do the relevant fees and charges.
Factors to examine when considering a Subdivision
• Local town planning regulations Land zoning restrictions Minimum size of lots Access to water and sewerage services Setback requirements Minimum building envelopes Parks and open space Easements Vehicle access including Council refuse collection Storm water management Increased noise from new development Environmental and heritage issues
Hidden Costs
A subdivision can take several months (and sometimes even years) to complete so you must factor in your holding costs such as: • Interest • Rates • Land maintenance – (eg slashing and weed control) Many astute Developers make the purchase contract for the land subject to the acceptance of a Development application approval with Council. This is usually done with an option agreement (see your Solicitor for more information)
Dividing the Land
Before you rush out and build a new dividing fence in your backyard, you should first consult your local Council for specific guidelines and costings, as it is imperative that the property is divided correctly. Any errors at this stage will cause major problems further down the track.
The Process
Most Councils require a Development/Planning Application to be lodged, together with details and drawings of your proposal. A Town Planner or Surveyor can assist you with this process, and they may also be able to give advice regarding conditions that the Council is likely to require. Before lodgement of the Application, you can ask the Council for a “Pre lodgement” meeting to discuss your subdivision and determine what issues will need to be addressed in the Application. When the Council receives your application, they may require you to erect a notice board for public viewing. The purpose of the board is to alert the public of the proposal by providing details of the subdivision. The Council may also write to the owners of the residents of the neighbouring properties advising of your intentions. We suggest that you contact the Council to find out what procedures your local Council uses.
Additional information the Council may require
Water and Sewerage
• Are existing services available? • Can the existing infrastructure cope with increased use or need upgrading? • Is permission required from neighbours to access property?
Storm Water
• How will storm water run off be managed? • Is a drainage pit required? • Are tanks required to regulate the flow of storm water?
Noise
• Will existing main road traffic noise affect the subdivision? • If so, how will this be reduced? (Fences and/or earthworks)
Soil Conditions
• Do the soil conditions (eg.sand, clay) impact on road and footpath design?
Other issues
Footpath Lighting Signage
Issues for the Developer to consider
For the Developer there are also other issues to consider such as: “Wasted” land due to unusual configurations Steep slopes Flood-prone land Other planning overlays (ie restrictions) Other factors that may reduce the number of lots and so profitability.
Approval of the Development Application
The approval process for your Application may take several months depending on the complexity and size of the subdivision. You will then be issued with a conditional approval covering topics such as: Developer to supply a plan of survey and mark land with survey pegs Road reserve Easements over stormwater, water and sewage mains Requirement that storm water pipes be designed to cope with a “1 in 100 year” event. Dust control Hours of permitted work (usually Mon – Sat 6:30am to 6:30pm) Headwork contributions to be paid by Developer Open space (parks) Social infrastructure Road infrastructure Water infrastructure Sewerage infrastructure Street scape contribution Disposal of cleared vegetation Entry walls or features Connection fees to live sewer mains Road (width, pavement depth, footpaths, kerb and channel, ramp profiles) Street lighting Fire Extinguisher (Battle axe blocks) Underground electricity and phone Erosion and silt management Maintenance period of roads Retaining walls Fire ant inspections Portable long service leave for Building and Construction Industry If you are not satisfied with the Council’s decision, you may apply for a review.
Operational Works
Before work can begin, you will need to engage the services of a Civil Engineer to design and draw the sewer, water, road, footpaths and any other Council requirements. This is a separate application usually referred to as “Operational Works” and attracts additional fees and charges.
Final Stage
All civil work will require Council and Engineering certification. When the subdivision has been completed to the satisfaction of the Council, you can then apply to register each separate title deed.
Conclusion
Land subdivision is a $mart way to fast track profits into your investment portfolio. However, as with all investment decisions, thorough research is necessary in order to balance the level of risk associated and ensure that the process runs as smoothly and quickly as possible, and that the best, most profitable outcome is achieved.

[AmandaBSParticipant@amandabsJoin Date: 2005Post Count: 549]

April 28, 2007 - 11:59 am

Two things I learn't from doing a subdivision:
1. It takes twice as long than expected
2. It also costs heaps more than first thought.

But if you can struggle through, the profit is pretty damn nice,  and you'll also be surprised that you  probably won't see much of a reduction in the value of the front house.

Best wishes,

[AmandaBSParticipant@amandabsJoin Date: 2005Post Count: 549]

April 28, 2007 - 11:51 am

Hi Xenia,

Yes I agree to bringing back the old "Subject Topic" section as it made it easier to just look at sections that interest me without trawling through pages.  The other thing that's gone is the name of who made the last post as well as how many have read the article.  Maybe I'm just getting old and don't like change !

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April 22, 2007 - 2:16 am

Yes thank you TerryW for sharing.

[AmandaBSParticipant@amandabsJoin Date: 2005Post Count: 549]

April 22, 2007 - 2:13 am

Yes she's an inspiring young lady.  I don't think her book is available in stores though but you can contact her here http://www.propertydivas.com.au/7ProfServ/Professionals.aspx?cmaid=789df9aa-ae58-4e79-bfd8-137b734b1802&cmstat=Profall

[AmandaBSParticipant@amandabsJoin Date: 2005Post Count: 549]

April 21, 2007 - 4:04 am

Hi CJ,

We live and have been investing in the Ipswich region for a few years now and have seen our property values and returns increase considerably,  but the market is very "hot" at present with houses selling fast.  You should be able to source a property for around the $200K with a 5% Gross Return but it will probably need a freshen up to be rentable.

South East Qld is experiencing the fastest growth rate of any urban region in Australia.  By 2026 the population is expected to reach 3.7million people, an increase of over 1 million people.  The SE Qld regional plan (http://www.oum.qld.gov.au) published in 2005 sets out to guide the direction of future development.  More than 80% of the region from Noosa to the NSW border and west to Toowoomba will be protected from development.  The SEQ regional plan also identifies a new urban growth corridor for housing and industry.  Ipswich is expected to grow from 140000 to 318000 people by 2026. 

To read about my visit to the opening of the new Orion Springfield :http://www.propertydivas.com.au/6Share/ReadStory.aspx?story=138d9e24-e46e-4cb0-b9ba-3aa5ac4d9d31

Hi Jaffasoft good to see you up and about!

[AmandaBSParticipant@amandabsJoin Date: 2005Post Count: 549]

April 18, 2007 - 12:47 pm

Hi Ian,

My understanding is that Capital Gains is calculated from when the asset is first purchased.  In this case this is the land back in Dec '05.  The house is an improvement on that initial asset and forms part of the cost base.  Probably worth giving your Accountant a ring to confirm though.

[AmandaBSParticipant@amandabsJoin Date: 2005Post Count: 549]

April 18, 2007 - 10:19 am

Hi Joel,

Yes you certainly can vary the amount of tax witheld from your salary by your employer, and its called a Income Tax Withholding Variation (ITWV)  The only issue is you're a bit late for this year but 2008 forms should be available off the ATO website by mid May 2007.
As Marc has stated you won't be paying any less tax, rather its just spread over the year instead of getting a big lump sum tax refund.  Be careful and don't overvary as penalties will apply if you receive a debit assessment of $500 or more.

[AmandaBSParticipant@amandabsJoin Date: 2005Post Count: 549]

April 18, 2007 - 10:07 am

Spot on Ian well done!

The CGT of $69K will be added to your other taxable income.  The 2007 rate is 31.5% for 25000 – 75000;41.5% 25001 – 150000 & 46.5% over 150000.

For example

Salary is $50000 + Cap Gain of $69000 = $119000 taxable income

Therefore $25000 is taxed at 31.5% =    7575.00
and the balance of $44000 at 41.5%= 18260.00

Therefore in this example you would pay a total of $25835 in CGT plus any other tax owing from the salary of $50000.

Hope this makes sense!

[AmandaBSParticipant@amandabsJoin Date: 2005Post Count: 549]

April 17, 2007 - 10:17 am

I really think this issue should be discussed with your Accountant.  The following is an extract of a document off our website that explains the difference further:

Trust ownership is probably the most flexible way to own an investment property. The most common Trusts are: Discretionary Trust

A discretionary trust is often referred to as a "Family Trust". It provides flexibility in sharing income within a family and can operate for up to 80 years.

Income is distributed according to the trustees’ discretion, by allowing the income to be distributed to lower tax earners and relatives, including children (conditions apply).

Some advantages are low establishment costs and asset protection, as only the trustees can be sued. Disadvantages include the fact that if there are losses, these will be quarantined within the trust and cannot be distributed to beneficiaries. Therefore a discretionary trust may not be suitable for investors who practice negative gearing – unless the trust receives income from other sources. Also, land tax thresholds are lower than for individuals.

In a unit trust, the trustee holds assets on trust for the unit holders. A unit in a unit trust is like a share in a company, as it reflects your wealth in the unit trust. A trustee can be either a company or an individual. Advantages of unit trusts are that they are cheaper and more flexible than a company setup, non family members can own units, and also the fact that they can borrow money and carry on business. The main disadvantage is that the trustee has no discretion in the distribution of income, as the distribution is determined by the unit entitlement which was agreed when the trust was established.

• This reply was modified 10 years ago by  AmandaBS.
• This reply was modified 6 years, 7 months ago by  Forum Moderator.

[AmandaBSParticipant@amandabsJoin Date: 2005Post Count: 549]

April 17, 2007 - 10:11 am

Yes, our website has several free templates you can download:  Lease Renewal (Word Document)
	Lease Renewal (PDF)
	Rent Arrears (Word Document)
	Rent Arrears (Pdf)
	Entry Notice (Word Document)
	Entry Notice (PDF)
	Rental Ledger (Excel Spreadsheet)
	Property Rental Application (PDF)
Landlords Property Rental Assessment (PDF)
	Annual Rental Inspection Checklist (PDF)

[AmandaBSParticipant@amandabsJoin Date: 2005Post Count: 549]

April 16, 2007 - 4:01 am

You're most welcome, glad to help other fellow property investors, and yes "eyeore" I am very passionate about my local area of Ipswich.  Last week saw the opening of the West wing of Riverlink, and it was reported they had 150,000 people in 3 days.  The new Citybeach store had the highest trade results of any other new store in Aus.  I'm looking forward to the opening of the East wing next month which will include an Officeworks, so no more travelling to Brissy….yeh!!
The next project to open will be the first high rise developmemnt in Ipswich called "Aspire" , and last week they reported to be 8 weeks ahead of schedule which is great news.  Will have amazing views.

[AmandaBSParticipant@amandabsJoin Date: 2005Post Count: 549]

April 13, 2007 - 11:10 am

Hi MM,

Well I'm not very familiar with the rules in the ACT but perhaps you could try contacting Gary Seeto (888 Abundance) of this forum who lives there.

https://www.propertyinvesting.com/user/53670

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April 13, 2007 - 4:38 am

The joys of slab on ground!!  Give me a lovely Queenslander on stumps any day.

[AmandaBSParticipant@amandabsJoin Date: 2005Post Count: 549]

April 13, 2007 - 4:33 am

That's a new one to me also so I've just added it to our Glossary of Terms.

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April 13, 2007 - 4:28 am

Hi Cherry Pro,

We also have a number of free downloadable spreadsheets and templates on our website that may be of interest to you.

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April 13, 2007 - 4:25 am

Great research Xenia, thanks for sharing.

[AmandaBSParticipant@amandabsJoin Date: 2005Post Count: 549]

April 13, 2007 - 4:24 am

Yes Raddles is correct you will need to declare the rent as income but can also claim any expenses.  No CGT as long as the asset isn't changed in any way. 
Lucky devil!! Not many people still holding a pre CGT asset.