Renta Property Tax Returns affected by COVID-19

Frequently asked tax questions for rentalproperties affected by COVID-19

My tenants are not paying their full rent or have temporarily stopped paying rent because their income has been adversely affected by COVID-19. Can I still claim deductions on my rental property expenses?

The simple answer is Yes 

If tenants are not meeting their payment obligations under the lease agreement due to COVID-19 and you continue to incur normal expenses on your property, then you will still be able to claim these expenses in your tax return.

I’m considering

COVID-19 $150,000 Instant Asset Write-Off

The best tax breaks for small business is the instant asset write-off, a great way for your business to purchase capital assets and get an immediate tax deduction.

As part of the COVID-19 Coronavirus Stimulus Package, the instant asset write off threshold has increased from $30,000 to $150,000 (net of GST) per asset acquired.

This measure applies to all purchases from 12 March 2020 to 30 June 2020 where the assets are used or installed ready for use, in the business by 30 June 2020.

Examples of tax-deductible items

Some of

Employer payments to employees

Job Keeper Payment OverviewSupport for Employers to keep employees on the books!

Employer Register Now for Jobkeeper

The Job Keeper Payment will provide a flat $1,500 a fortnight per employee for businesses to retain or rehire nearly six million workers.Businesses that experience a 30% drop in turnover since the 1st March 2020 will be eligible.

Employers that have already lost their job will be eligible if the business had them on the books on the 1st March 2020.

The first payment will be received by employers from the ATO in the first week

2nd Wave COVID-19 Stimulus Packages

Income support for individuals & Sole Traders

Over the next six months, the Government is temporarily expanding eligibility to income support payments and establishing a new, time-limited Coronavirus supplement to be paid at a rate of $550 per fortnight. This will be paid to both existing and new recipients of Jobseeker Payment, Youth Allowance Jobseeker, Parenting Payment, Farm Household Allowance and Special Benefit.Reduced means-testing:Asset testing for Jobseeker Payment, Youth Allowance Jobseeker and Parenting Payment will be waived for the period of the Coronavirus supplement.To further accelerate access

Corona Virus Stimulus Packages

Low Income Australian

The Australian Government will provide financial assistance to around 6.5 million lower-income Australians in response to the Coronavirus.One-off payments of $750 will be paid to around 6.5 million lower-income Australians, including pensioners, other social security and veteran income support recipients and eligible concession cardholders.This is to help them through this uncertain time and support economic activity.The one-off payment will be paid from 31 March 2020.

Download

Fact sheet: Stimulus payments to households to support growth

Example

Emma receives both Newstart Allowance and Family Tax Benefit as of 12 March 2020. As part

New tax laws were proposed as part of the 2018 federal budget to deny tax deductions on the costs of holding vacant land, that has now been passed and come into effect from the 1st July 2019.  These new laws apply regardless of when the land was held, (no grandfather clauses for pre 1st July 2019 lands).

The
new laws are contained in Treasury Laws Amendment (2019 Tax Integrity and
Other Measures No.1) Act 2019 which received royal assent on 28 October 2019.

Entity Types Affected!

Individuals – (Mum & Dad Investors)Private trusts (closely held

Recently the ATO has publicly advised of a number of instances whereby property developers were jailed for GST and tax payable on property flipping.One, in particular, involved a Victoria woman who has been jailed for 2 years and 10 months for GST fraud of $1.7 million.The women in question Ms Simone Semmens purchase, developed and sold ten luxury properties in Toorak, Portsea and Caulfied North between 2005 and 2011.Ms Semmens carried out extensive work on the properties, involving developing, subdividing, before selling the properties for a profit of approximately $4.4

Flipping Properties

Flipping houses
can be a great way to make a living or a handy lump of cash quickly, however it
involves

Finding the right propertyFinancing can be on a short-term basisGetting the number rightExecuting the makeover and selling in the shortest time possibleGetting the right tax outcome is critical to your net return!

What is Property Flipping?

What is Property Flipping?

Flipping a property is buying at one price, then doing a strategic makeover to sell quickly for a higher price.

Buy-to-sell (BTS)

To some property flipping is trying to buy at a big discount to

After 20 years plus of preparing rental property tax returns, I’ve come up with my list of the “Top 10 Rental Property Tax Return Mistakes”.

1. Co-owned properties – Apportioning expenses and income

If you own a rental property with someone else, you must declare rental income and claim expenses according to your legal ownership of the property.

As joint tenants, your legal interest will be an equal split (50/50), any expenses paid by either joint tenant is assumed to be paid on behalf of both equally, regardless of

Property Spruiker Seminars do your own research.

With interest rates so low, and property prices in many capital cities have come back in value, coupled with rising rents in selected areas. Property Spruikers are coming out of the woodwork to make their perennial cash grab from the uneducated aspiring property investors.

Perennial Cash Grab by Property Spruikers

Don’t get me wrong, there are great opportunities to invest in property, if you can’t find a cash flow positive rental property at the moment, then you aren’t looking hard enough. As with all investments, returns,