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,

Single Baby Boomers Cooperative Living

Emerging trends

Some single baby boomers are using their home as a money box to sell up, pool resources and move in together.

Cooperative living for older people is a well-established
movement in countries such as the US and many European countries, with some
people successfully living together for decades.

In Australia it is only beginning to become popular. There
are more single women living on their own than men. Women make up nearly 30% of
women aged 64-75 living on their own compared with 18% of men.

Frequently the family home is

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

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

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