Subdivide the backyard

We are getting a number of inquiries from people living on large blocks of land, (i.e.) 800m2 plus in suburbia, or areas surrounding, looking to subdivide for various reasons some of the lands, to help fund things like:-

major renovations to their existing home, which they may not be able to afford otherwise, so they can stay put.build their dream home, without having to move from the area they know and love.unlock equity from their home, to fund retirement, without having to move, or consider a reverse mortgagefund holidays, health

No CGT discount for non-residents,
however former Australian residents will get a pro-rata discount.

From 9 May 2012, the 50% CGT discount allowed for gains made by individuals is reduced for any periods in which the taxpayer has been a foreign resident during the period of ownership (s 115-105 ITAA 1997). This applies irrespective of whether the asset is held directly or through a trust. For these purposes, a foreign resident includes a temporary resident.

The method of calculation varies
according to when the asset was acquired. For example:

If a resident holds an asset as at 8 May 2012, but

A luxury property developer who caused a loss of $3.4 million to the Commonwealth through GST fraud has been sentenced to six years’ jail after an ATO investigation.

Mr Ensor’s conviction came after an ATO investigation found he had structured his companies to fraudulently obtain GST credits and failed to report property sales to avoid paying GST, causing a loss to the Commonwealth of $3.4 million.

Failed to Report GST on Sales while claim GST to fund developments

Between 2008 and 2011, Mr Ensor lodged false BAS statements on behalf of nine companies

Trusts tax reform set to go ahead under Labor

After first being announced in 2017, Labor’s proposed tax for discretionary trust distributions is shaping up to be a key election issue.

About two years ago, opposition leader Bill Shorten announced that Labor would reform the taxation of discretionary trusts to prevent income from being allocated to household members in lower tax brackets.

As part of its reforms, Mr Shorten outlined that :-

Labor would introduce a minimum 30 per cent tax rate on all trust distributions to adult beneficiaries if elected  in 2019.  

Following the release of a report on trusts

New market research indicates about 900,000 interest-only loans will revert to principal and interest payments this month, following a tougher year on the mortgage market for property investor clients.

Comparison site finder.com.au drew this estimate from an analysis of housing finance data from the Australian Bureau of Statistics (ABS).

The expirations follow restrictions from the banking regulator, APRA, on interest-only lending. APRA’s cap saw interest-only loan approvals fall by about 55 per cent in the 12 months to June 2018.

APRA’s restrictions and the revelations of the royal commission also formed part of

Labor’s Negative Gearing – limited to New Construction

Labor may implement tax policies of negative gearing restrictions, reduction of the CGT discount, and ending excess dividend imputation if it wins government next year. If you hold any investments you may be subject to Labor’s negative gearing restrictions which would likely be limited to newly-constructed housing.

The restrictions would apply on a global basis. For example, Ian obtains a loan to buy shares after Labor’s negative gearing restrictions come into effect, shortly after he receives an unexpected windfall and uses the money to purchase

The Property Capital Gains Tax Identifier will help those selling an investment property or their home that was used partially to derive income or operate a business from, determine if any capital gains tax  is applicable and an indication of how much capital gains tax may apply.

I’ve provided some guidance in working through any CGT issues, the simple Property CGT Identifier will highlight the various issues we all need to consider when we sell our home and or an investment property.

As the old saying goes, “Forewarned is Forearmed” –

You can

House & Land Development Tax Planning Opportunities

Property development has become a way for mums & dads and the like to capitalise on their big backyards, with a small property development subdivision. Those with house lots over 1000m2 have opportunities to do their own development.

Every State, Region in Australia has minimum lots sizes depending on zoning.

See:- Brisbane City Council – Selected Zones and minimum lot sizes

Zone
Zone precinct
Front lot (m2)
Rear lot (m2)

Low density residential
–
450
600

–
400 (small lot)
600

Low density residential around centres*
–
300 (small lot)
600

Character residential
Character
450
600

Infill housing
300
450

Low-medium density residential
2 storey mix
260
350

2 or 3 storey mix
260
350

Up

Most will be aware that the 2017 Federal Budget removed  depreciation on fixtures and fitting included in a   2nd hand rental property, for example – carpets, window covers, hot water services, ovens, and the like, If purchased post the 9th May 2017.

If you have owned an investment property prior to 7.30pm on 9th May 2017 (2017 Federal Budget Announcement), you weren’t effect by the changes, and as such still able to depreciate  any 2nd hand fixtures and fitting already in the property.

Opportunities  to look for in a
2nd hand properties

2018 DEDUCTIONS FOR SPECIFIC INDUSTRIES AND OCCUPATIONS

Please see below our 2018 Individual Tax deduction Checklist. You may be able to claim deductions for expenses that directly relate to your work as an employee. To claim a work-related deduction:

you must have spent the money yourself and weren’t reimbursed
it must be directly related to earning your income
you must have a record to prove it.

2018 WORK-RELATED EXPENSES GUIDES

The following guides for 2018 specific industries and occupations will help you to correctly claim the work-related expenses you are entitled to:

Adult industry workers
Australian Defence Force