Investment Property tax question ??
Oct 2nd 2006, 8:31 am
#1
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Investment Property tax question ??
Wondered if anyone could help we have bought an investment property in Brisbane and we at the stage of deciding how to split the property between us but can't seem to find any info on the best way to do this one of us earns 60% of the total income and the other 40%, but have heard that it not only depends on the tax saved by the higher earner but also the that they pay more in capital gains aswel as other factors.
Anyone any ideas
Anyone any ideas
Oct 2nd 2006, 9:11 am
#2
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Re: Investment Property tax question ??
Originally Posted by tabby
Wondered if anyone could help we have bought an investment property in Brisbane and we at the stage of deciding how to split the property between us but can't seem to find any info on the best way to do this one of us earns 60% of the total income and the other 40%, but have heard that it not only depends on the tax saved by the higher earner but also the that they pay more in capital gains aswel as other factors.
Anyone any ideas
Anyone any ideas
Oct 2nd 2006, 9:10 pm
#3
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Location: Melbourne
Posts: 355
Re: Investment Property tax question ??
Originally Posted by tabby
Wondered if anyone could help we have bought an investment property in Brisbane and we at the stage of deciding how to split the property between us but can't seem to find any info on the best way to do this one of us earns 60% of the total income and the other 40%, but have heard that it not only depends on the tax saved by the higher earner but also the that they pay more in capital gains aswel as other factors.
Anyone any ideas
Anyone any ideas
Firstly, capital gains is only paid on the sale of the property, so if you are looking at long term investment this is probably not your first concern, but normal income tax.
If you are married and unless you buy the property soley in one name you may find it difficult to split the income on anything but a 50/50 basis as far as the tax man is concerned (although formal advice would be the way to go)
You will only save tax by splitting the ownership if one of you is in a lower tax bracket. If you both hit the top bracket nothing is saved by have the owenership in one name or the other. Does this make sense?
If you are really serious I (along with the other poster) would suggest you speak with an accountant to find the best way of maximising your return and minimising your tax. For example if you live in the property for a time you can reduce the amount of tax payable, so if in the long term there has been a huge increase in value, this is something to think about.
Good luck with your choices
Abby
Oct 3rd 2006, 2:49 am
#4
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Re: Investment Property tax question ??
Actually you can dispose of a CGT Asset without selling it in the normal sense ... have a look at "CGT Events" on the ATO website.
Best regards.
Best regards.
Originally Posted by NIGENABBY
Hi
Firstly, capital gains is only paid on the sale of the property, so if you are looking at long term investment this is probably not your first concern, but normal income tax.
If you are married and unless you buy the property soley in one name you may find it difficult to split the income on anything but a 50/50 basis as far as the tax man is concerned (although formal advice would be the way to go)
You will only save tax by splitting the ownership if one of you is in a lower tax bracket. If you both hit the top bracket nothing is saved by have the owenership in one name or the other. Does this make sense?
If you are really serious I (along with the other poster) would suggest you speak with an accountant to find the best way of maximising your return and minimising your tax. For example if you live in the property for a time you can reduce the amount of tax payable, so if in the long term there has been a huge increase in value, this is something to think about.
Good luck with your choices
Abby
Firstly, capital gains is only paid on the sale of the property, so if you are looking at long term investment this is probably not your first concern, but normal income tax.
If you are married and unless you buy the property soley in one name you may find it difficult to split the income on anything but a 50/50 basis as far as the tax man is concerned (although formal advice would be the way to go)
You will only save tax by splitting the ownership if one of you is in a lower tax bracket. If you both hit the top bracket nothing is saved by have the owenership in one name or the other. Does this make sense?
If you are really serious I (along with the other poster) would suggest you speak with an accountant to find the best way of maximising your return and minimising your tax. For example if you live in the property for a time you can reduce the amount of tax payable, so if in the long term there has been a huge increase in value, this is something to think about.
Good luck with your choices
Abby
