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  • Profile photo of ADAD
    Join Date: 2002
    Post Count: 636

    All Wrappers…..

    Scenario : I buy a house for $60K, Wrap it for $80K.
    The purchaser pays me out in three years (better rates). I have diligently paid all my tax on capital gains on every payment.

    Question : How is the closing Capital gains treated (when payed out).
    Do I pay top marginal Rate or does the one year rule apply and I only have to pay 50% of top marginal rate [?][?][?]

    Look forward to your postings….


    AD [:0)]

    Profile photo of Steve McKnightSteve McKnight
    Join Date: 2001
    Post Count: 1,763


    In your circumstance outlined here, my opinion is that when you are cashed out in three years time you would need to pay the balance of the CGT… probably on a gain of about $19,000.

    Now, the actual amount of tax that you pay would depend on the entity you have purchased the property in and your own personal ‘structure’.

    If you purchased it in a company, the you would pay tax at a flat 30% ($5,700).

    In your own name you would get a 50% exemption, but you may pay at the top marginal rate???…???

    I suggest you talk to Mark about this when you meet with him in the next few days.


    Steve McKnight

    Edited by – [email protected] on 20/06/2002 12:11:40 PM

    Steve McKnight | Pty Ltd | CEO

    Success comes from doing things differently

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