I sold my investment property sold back in July 2010. I haven't pay the capital gain tax yet, so if I am going to pay the tax this financial year, will I occur some of penalty for late paying the tax or not since I sold my property back in July 2010?
BladeHi Blade
I know it's an obvious response but you should put that question to a qaulified accountant.
Cheers
Jamie
Jamie Moore | Pass Go Home Loans Pty Ltd
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That would fall into the taxable income year of 2010-2011. Tax returns were due to be lodged by around Oct last year, but I think this is extended to Feb or march this year if you are using a tax agent to lodge. Once the tax return is lodged then the ATO processes it and sends you a letter of assessment and then you will have x days to pay. maybe 21. At this point you can ring them up and ask for an extension to pay and they will let you pay it off in installments over a few months.
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
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I decided to pay the capital gain tax for the year 2011-2012 (lump sum), will i occur penalty since i sold my property back in July 2010?
You cannot just decide to pay the CGT in a different financial year. You must pay it in the year the contract was entered into. So if you signed contracts in july 2010 the tax would be part of the financial year of 2010/2011 which would be due about now.
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
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Ok, So if i do it this month, no penalty apply to me then?
Not neccessarily as it was technically due back in Oct
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
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Can you give me a few tax agent are good in Melbourne?
http://www.ato.gov.au/taxprofessionals/content.aspx?menuid=0&doc=/content/00283809.htm&page=1&H1
Above the site said i still can lodge in now with no problem.
You should note that site is for Tax Professionals. If you are using one you should probably be OK. Even if you are penalised it won't be much and you can ring them up and ask them to drop the penalty and they probably will.
If you are seriously ill then ask the ATO to wipe your tax debt – there is a good chance they will wipe it completely.
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
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Hi Blade,
Im not an accountant but its my understanding that you will have to lodge your return for financial year 2010-2011 by end March this year – has to be lodged by an accountant though (you've missed the Oct cut off to do it yourself) and then the money usually has to be paid by May.
Regards,
VictoriaI am in shock and very upset about my self and the situation atm. I went to my accountant today and try to fix my capital gain tax. I thought that i have 50% discount because my late wife and i bought the property back in July 2006 (more than a year holding). When i sold the property it have substantial amount of capital gain on that property.
Here is a rough summary about the situation that i am upset about:
Bought the property with my late wife 50/50 % joint tenancy.
She pass away on 13 July 2009
The property automatically goes to me.
I sold the property under auction on 3 of July 2010 and the final settlement is on the 2 Sept 2010.
I thought that we bought that property more than year so i will have the 50% discount, but no, because i sign the contract on the day of the auction on the 3 of July 2010, which not yet a year of my wife passing (i hold my late wife 50% less than a year), i only can get 25% discount on my part, which mean i have to pay about 15K more capital gain tax. I am so up set atm.
I just have a last question before i just want to forget about this <moderator: delete language>,
To hold the property a year, is that calculate the day i sign the contract after auction, or the final settlement?
12 months is from date of contract for purchase to contract to sell
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
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Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
When a joint tenant dies the survivor is treated as having acquired the deceased's interest in the property on the date of their death. s128-50 ITAA.
So Blade if you had waited 11 days you could have saved $15,000 in tax. (not trying to rub it in, but just wish to point out to others the importance of getting legal and tax advice).Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
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Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
My accountant call me moment ago and said that i will have the 50% discount YAY!!!
She said that if my love one die, is exemption from the rule of holding at least 1 year of my late partner 50%.
Thanks again for info……i am over the moon atm
Hi Terry,
Could s115-30 (item 4) apply here or would it be overruled by s128-50?
http://www.austlii.edu.au/au/legis/cth/consol_act/itaa1997240/s115.30.html
hi Mike,
S115-30(4) couldn't apply in this case because the interest of the deceased didn't pass via the estate. If the property was held as Tenants in Common it would have applied though.
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
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Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Joint tenants are treated for CGT purposes as if they are tenants in common in equal shares (s.108-7).
s.128-50 gives deemed transfer and cost base rules.
s.115-30(1) item 7 extends the general discount deemed acquisition rules as well.
Cheers,
Rob
Thanks Rob for that.
s114-10(7) says that the survivor is taking to have acquired the interest of the deceased at the time the deceased acquired it and the 12 month discount would be applied fro that date.
http://www.austlii.edu.au/au/legis/cth/consol_act/itaa1997240/s114.10.html
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Hi Terry,
Division 114 is for indexation.
Cheers,
Rob
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