The CGT Implications of Subdividing and Building on the Family Property

Given the state of the property market in Australia these days, a not-uncommon situation can arise where a residential propefty owner seeks to demolish and subdivide the block containing the family home and build residential units. lf you have the available land of course, the above is a solid strategy. However it can cause headaches from a tax perspective — and in [Read more…]

Steps to Successful Property Investment

Property has been considered a popular path to wealth for Australians for many years. It has the potential to generate capital growth (an increase in the value of your asset) as well as rental income. There are also tax advantages associated with negative gearing. However, when buying an investment property, it is wise to remember that you are making [Read more…]

Gumtree sourced assets, and the realities of making a claim

A recent case before the Administrative Appeals Tribunal (AAT) brought into focus a growing phenomenon that you should keep in mind for work-related or business expense deduction claims, especially where the acquisition of claimable assets is made in a certain way. THE ENGINEER AND HIS “INVOICE” The AAT case involved a taxpayer’s attempt to make [Read more…]

Simplified depreciation rules for small business

The simplified depreciation rules are attractive for small businesses as, among other things, they allow an immediate write-off for assets costing less than $20,000. In contrast, tax paying entities that do not qualify as a small business must use the general depreciation rules (also known as the uniform capital allowance rules), where certain assets need [Read more…]

Getting deductions for clothing and laundry expenses right

The ATO allows certain taxpayers to claim a deduction for the cost of buying and cleaning occupation-specific clothing, items of protective wear and for certain unique, and usually distinctive, uniforms. To claim a deduction it is generally expected that you will be able to provide evidence that you purchased the clothing concerned, and will have [Read more…]

What is your “total superannuation balance” and why does it matter?

Recent superannuation reforms introduced a concept of “total superannuation balance”, which on the surface may give the simple impression that it is the sum of the balances of a person’s superannuation interests. However, this is not the case. What is the total balance relevant for? The total superannuation balance is relevant in determining a super [Read more…]

Identifying a good investment property

Most of us have heard the saying ‘Location, location, location’, but have we thought about what it actually means? Is it the only factor when considering buying an investment property? Location, location, location There is no doubt that location is one of the most important factors in determining a good investment property. It influences your [Read more…]

SMSFs And The In-House Asset Rules Explained

A not-uncommon conundrum for many SMSF trustees is what to do when the fund is found to have breached the in-house asset rules. There are also some common misconceptions about these regulations that keep resurfacing. WHAT DOES THE ATO SAY IN RELATION TO THE IN-HOUSE ASSET RULES? Recent ATO statistics on the SMSF sector show [Read more…]

FBT And Cars: A Perennial Head-Scratcher

The provision of cars by employers to employees remains an issue that continues to create confusion for some business taxpayers. A not-uncommon situation is where the employer fails to identify that a car fringe benefit has been provided. This is typically found in family companies or trusts where a car bought by the business is [Read more…]

Share Dividend Income and Franking Credits

Mum and dad investors in receipt of dividends from their share portfolio often benefit from investing in blue chip shares because they usually have franking credits attached. As a general rule, an Australian resident shareholder is assessed for tax on dividends received plus any franking credits attached to those dividends. The shareholder is assessed on [Read more…]