27th and Petersham RSL is good for me – are we going to start at 3pm instead of 4pm – I know it was mentioned by someone that we should start a bit earlier ? See you there

Cheers

MIKALA

I was thinking of both scenarios – I suppose we have already been developing to hold – we have only bought land, built then rented so I guess I was wondering about the differences if you were developing to sell (is it really called property trading ??)
Doesn’t the CGT 50% after 12 months still apply?

Dazzling,
Thanks for your reply…I…[Read more]

If the Investment was putting $$$’s in your pocket every week why did you sell ?.

Cheers

MIKALA

You most certainly can – the whole essence is whether the interest repayments are for a loan which is for the sole purpose of investing – it is the intention which is important.
If you intend to build and rent you can claim the interest repayments on the loan for the block of land providing both properties on the subdivided blocks are…[Read more]

Cheers

MIKALA

Is there any possibility of the 2 accountants having a phone conversation to discuss – maybe one can convince the other of the correct position and then you can both lodge the same claims

Cheers

MIKALA

I really enjoy getting together with everyone – it is a great opportunity to hear what others are doing and catch up.

We are planning on next meeting mid November hopefully at Petersham RSL, 7 Regent street, Petersham. It was a great venue – thanks to Toni.
All are very welcome.

Can I propose 3pm 20th Nov – would this date and time suit…[Read more]

We bought in Kirwan last year (got lots of equity straight up) and this year we were going to buy land in Condon and build but it would have been much more expensive than we wanted to outlay so backed out. Having said this though we believe it is a good area for an IP.
Kirwan property seems to rent fairly easily.when you mention…[Read more]

Yes I bought ticket some time ago and am looking forward to it…

Cheers

MIKALA

Have been busy but am keeping an eye on the forum.
I’ll definitely be attending – has anyone been able to invite any specialists along ?
Toni are you out there ?
How’s your development going ?

Cheers

MIKALA

That’s great – will see you all there – shall we bring some food?
We may get a bigger hungrier crowd this time ! Are we still going to have specific topics or shall we play it by ear ?
If specific topic may I suggest the following –
How to borrow for another IP when your borrowings are at 80% lvr (not there yet personally but it will…[Read more]

Newtown sounds good and Sunday afternoons are fine
except I’m interstate on the weekend of 1st/2nd Oct – can we make it a different weekend to this ?

Cheers

MIKALA

Redwing is right – I checked this with the ATO..

Cheers

MIKALA

good luck..

MIKALA

I think everyone would like to know what their property would be worth in 32 years time – the mind boggles !
7th year $1.3 mill
14th year $2.6 mill etc etc etc
I’ll be looking at my teeth on the bedside by that time however back to your question – if you look at property in the UK (property ownership has been going on for a much…[Read more]

From your info it is not positively geared (but very close) unless you have any other tax deductions (any depreciation?)

On 6.95% with a loan of $135,000 (cost plus reno cost , no borrowing or purchasing costs were included I am assuming and which you should allow for) you would be paying $9382.50 in interest, $1300.00 in rates (have…[Read more]

Thanks for your reply – vendor states that there are 5000 students currently with the uni gaining more students in the future – however that may just be the vendors estimate ??
I’ll check out the uni on the web and see if I can find out more that way.
By the way the apartments are a/c so maybe that would account for the higher…[Read more]

Are you obliged to use these guys as your builder?
Yes the builder has hold on land

Is the $2k refundable?
As they have not performed any of the tasks the $2000 is for, I would say it is refundable at this stage

Do you only have a verbal that the $2k will be creditted towards the total price?
No, on the preliminary…[Read more]

Thanks for your replies and the book sounds like a good read…

MIKALA

MIKALA

I pay 7.5% plus GST for mine so 8.5% plus GST is in the ball park – did you negotiate ?
I just signed recently agreement for IP in Qld – they usually charge 8.5% plus but I just told them what I was willing to pay as this is what I pay in NSW….

MIKALA

I’m still confused –

1st secnario – Not registered for GST
If I bought a block of land for say $99,000 and included in that cost was $9000 GST then build a house for $99,000 and there is $9000 GST in that cost can I then claim back $18,000 ?
If not, can I then claim $18,000 as a tax deduction?

2nd scenario – After purchasing the…[Read more]

Thanks for the reply – the following is straight out of the WealthGuardian workbook –

The GST is generally not applicable to residential property, so any GST paid in relation to residential property investing cannot be claimed back. However while not refundable, a tax deduction is allowed for GST amounts paid.

The exception to the…[Read more]

Recently went through the whole question of whether loan interest payments were tax deductable before earning any income and ended up talking to the ATO – they confirmed that yes you can and that is what I have done for the last tax year – no problem….

MIKALA

Thanks for your reply but the more I read on it seems that the situation of new building purchase or major renovation means that you could claim the GST back or at the very least claim the GST component of your purchase cost as a tax deduction – if this is the case then I’ll be organising some tax return amendments pretty…[Read more]

Sounds good – I will take you up on that next purchase!!! I hope I didn’t upset you – I know it is important to have a great team when investing and brokers can form a extremely important part of that team – I just felt that it is important when someone is starting off that they know all the facts (even though I don’t know most of…[Read more]

Just after reading Simon’s reply – no offense intended Simon – however be careful of broker’s advice – they do receive commisions after all so make sure they declare to you what they are getting out of their advice to you regarding which loan to go for….personally I check out the information from the horses mouth so to speak – takes a…[Read more]

MIKALA

MIKALA

Is the property new ? If so then you can add in the tax benefits (depreciation included) as other income in your calcs – in figures would make your cashflow a bit better. I recently bought the ID and was advised that this is where you add the benefit.
Also if new you wouldn’t really need to allow $650 pa for maintenance costs for at…[Read more]

Regards,

MIKALA

MIKALA

MIKALA

We have used BMT twice and found them very good.
Usual fee is $600 and they have a office in Townsville.
Reports seem to be very thorough

MIKALA

If I were you I would stay home, keep saving as much as you can – in the meantime find out as much as you can about investing in property (or the stock market if you are inclined that way – personally I like property!) – practise look for good positive cah flow properties and educate yourself on all aspects of financing and accounting…[Read more]

Yes – you can definitely claim the building inspection as a deduction as it is a expense in the earning of your income on an investment property – it does not matter that you have earned no income yet – it is the intent which is important according to the taxation department…..see my earlier post…NO ICOME EARNED DEDUCTIONS YOU CAN…[Read more]

We are in exactly the same position – about to build no. 3 so couldn’t stick with someone who not only did not know what he was doing but was not willing to find out !
It just goes to show that even though we are paying for someone else’s experience we really need to keep our own knowledge of the tax situation up to date

Regards

MIKALA

Most definitely – that is our situation and why I rang the taxtion department to find out – I spoke to a taxation dept IP specialist there.
I also asked the question regarding time involved ( for future reference) and they said that they did not have a definitive time as each case is individual, They did mention that they had allowed…[Read more]

Is this also the case with an IP under construction ?

Regrow

You are a fool for 5 seconds if you ask a question, but a fool for life if you don’t.

Judy Cooke

Thanks for your reply – on my first IP the taxation department has allowed for borrowing costs claimable over 5 years so wouldn’t it be the same for this one as long as the intent is for investment only even though no income has been earned yet it should be able to be claimed against other income such as wages or other rental income…[Read more]

Interestingly the interst is deductible – there have been a number of test cases that have come down in favour of the investor for this.

Michael Yardney
METROPOLE…[Read more]