Hi Everyone this is my first post. I have question regarding CGT.
How is it calculated? I was under the impression that the first 50% of the gains you made was exempt and the 2nd 50% is taxed at 48%?
And is this a fair deal for agents commission.
5% on first $18000
2.5% on remaining (all inclusive of GST)
Please note the props in QLD.thanks much
CGT – close.
The profit made on the property after costs are deducted is halved then added to your taxable income.
This may well push you over the highest bracket.
An idea is to sell in a year that you have little or no income tax as assessed?
Cheers,
Simon Macks
Mortgage Broker
http://www.mortgagehunter.com.au
0425 228 985Comments may not be relevant to individual circumstances. If you intend making any investment, financial or taxation decision you should consult a professional adviser.
In regards to the agent’s commission, I think it sounds fair. 5% of $18000 isn’t really going to net them much, and 2.5% on the rest seems about standard – or less even than I’ve been paying.
Cheers
MelThe GST calculation Simon refers to is on the basis that you don’t sell the property in the same year. Remember the Contract date is the date used by the ATO to assess CGT and not the settlement date.
The scale of commission you refer to is the standard REIQ rate of commission in Qld.
Cheers Richard
richard at fhog.com.au
http://www.fhog.com.auThere is no such thing as a problem.
Just a solution waiting to be foundRichard Taylor | Australia's leading private lender
Richard,
Is then the starting date, the contract date when you buy or when you physically move in?james
Thanks for all the help guys and gals. I have had this IP for the last 5 years so I will be in for a bit if I sell [
].
Moving off the topic, has anyone ever heard of CGT exemption? What I mean is that if you live in QLD and sell your IP and then re-purchase in QLD straight away (or whatever the allowed time period is) you will be exempt from paying CGT. I got this off an agent.cheers
Snorky
As usual an agent with his facts slightly out of kilt.
He is referring to the “Going Concern” provision in the CGT Act however your IP will not qualify for this as it is aimed at the same of small business.
Cheers Richard
richard at fhog.com.au
http://www.fhog.com.auThere is no such thing as a problem.
Just a solution waiting to be foundRichard Taylor | Australia's leading private lender
Snorky,
Just wanted to clarify something for you about the CGT Exemption. It is called Asset Replacement Roll-over. It is not actually an exemption. It just defers the Capital Gain until you sell the asset that has replaced the original asset. This means you can keep money in your pocket to keep investing. There is a time limit on it and I would advise you to talk to your accountant more about this before you sell the property.
Cheers
Rachael
Hi rachaelm15207 and co.
My assumption regarding CGT exemption was not not to pay CGT at all but like you said rachael it’s until you sell the nxt prop. you invested in.
Deferred CGT to re-invest does sound tempting [
]off to the accountant I go!……thanks
Question for a Queenslander. Is the commission structure mentioned as part II of Snorky’s original post legislated (or at least consistent for all agents) or is it flexible?
James, start date is the day you sign the contract. End date is the day you sign the contract to sell. Need to be careful if you give a long settlement, but exchange in one year and settle the next. CGT hits you in that first year’s tax return, which may need to be paid before you settle.
Cheers
MelRubbachook
the RE commission is a MAXIMUM and is regulated by the PAMD (Property Agents and Motor Dealers Act) s180 or 181 I think. This means that you can negotiate a lesser commission but the agent cannot charge more than the figures you outlined.
TC
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