Just quickly,
I am selling a neg geared property I own. I was wondering if anyone can give me a rough idea how to work out the capital gains tax I will pay and how much commision would you expect to pay to the agent for selling it?Thanks.
Hi JRW,
Commission – 5% on the first $18 000 and 2.5% on the balance of the sale price (in QLD).
Ian [smiling]
CGT: Basically purchase price minus selling price, less a few costs such as stamp duty. You may also have to add back any depreciation claimed. If you have owned (from date of exchange, not settlement) the property for more than 12 months, you may get a 50% reduction in the CGT. This figure is then added to your income for the year, and you pay tax on the combined income. You had better download the CGT booklet from the ATO site.
Agents commission is around 2.5%, but this is negotiable. Remember, the market is slow now, and agents need listings.
Terryw
Discover Home Loans
Mortgage Broker
[email protected]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
Simple way to work out commission for a real estate agent = (Sale price +18,000) divided by 40 give you a dollar figure.
remember it is a sliding scale therefor it goes up and down with the price.Hi Terry,
can you please explain the CGT again? For examply if I paid $160 for my IP and then sell it for $320, do I owe tax on $160? It’s been owed for more than 12 mths. Does it make any difference if it was my private residence for a year?
Thank
Landt.Landt
I am not an accountant, but think it would go like this:
$160,000 profit, less costs such as stamp duty, agents fees etc
maybe $10,000 = $150,000
Since you have held it for more than 12 months, this is discounted by 50% = $75,000.
This is just added to your income. If you have purchased jointly with a spouse/friend, then only your share is added.So say you earned $50,000 for the year. Your taxable income will now be $125,000, and you pay tax based on this amount.
Worse case scenario, would be 50% tax on $75,000 = $37,500 extra tax payable.These are very rough figures!
Terryw
Discover Home Loans
Mortgage Broker
[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Thanks terry,
i was never 100$ sure how that worked.
Landt
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