2009 ITWV Notice Received Back.
- Thread starter Rixter
- Start date
Hi,
If i have an offset account, how do we suppose to calculate the interest IP expenses on F3? Do we assume how much money will be on offset account and deduct money borrowed to this amount?
But then again im not sure if that money will stays in offset account (i could prbly use to buy other stuff)
thank u.
If i have an offset account, how do we suppose to calculate the interest IP expenses on F3? Do we assume how much money will be on offset account and deduct money borrowed to this amount?
But then again im not sure if that money will stays in offset account (i could prbly use to buy other stuff)
thank u.
For one to achieve $0 taxable income, does that usually involve "capitalising" interest expenses of some sort with very high LVRs?
Just curious as I haven't done my tax return yet and this will be the first time that I'll get to do one since acquiring my first IP as well as a third income. I have no idea how I would ever be able to get my taxable income down from approximately $200K. Would that even be possible without having an immense IP portfolio?
Or would I be correct in assuming the following rudimentary calculation: to claim $200K in IP interest deductions at 9%, I would need a property portfolio of $2.2 million, not even other IP expenses nor income and depreciation. If that's the case then it doesn't actually sound out of reach - given many future years in the game and a substantial amount of equity created gradually.
Just curious as I haven't done my tax return yet and this will be the first time that I'll get to do one since acquiring my first IP as well as a third income. I have no idea how I would ever be able to get my taxable income down from approximately $200K. Would that even be possible without having an immense IP portfolio?
Or would I be correct in assuming the following rudimentary calculation: to claim $200K in IP interest deductions at 9%, I would need a property portfolio of $2.2 million, not even other IP expenses nor income and depreciation. If that's the case then it doesn't actually sound out of reach - given many future years in the game and a substantial amount of equity created gradually.
To get your taxable income to 0%, the sum of your cash taxable deductions and non cash taxable deductions (ie depreciation) must be greater than the sum of all your gross assessable income.
The greater the sum of all your non cash taxable deductions, the greater your cash flow will be.
This is one reason why part of my purchasing criteria involves acquiring new or new new property so as to maximise my non cash deductions.
Hope this helps.
We received the lower income tax benefit! Woo hoo!
Yeah is a blast....not only do we reduce our tax but the ATO even gives us extra benifits.
Just curious as I haven't done my tax return yet and this will be the first time that I'll get to do one since acquiring my first IP as well as a third income. I have no idea how I would ever be able to get my taxable income down from approximately $200K. Would that even be possible without having an immense IP portfolio?
:
Buy shed loads of land and start building in this ever expensive construction market. The holding cost will kill you but at least you'll be able to wipe that $200k down to $0..
Buy shed loads of land and start building in this ever expensive construction market. The holding cost will kill you but at least you'll be able to wipe that $200k down to $0..
Only if you dont have the knowledge in how to structure correctly.
But then again if you didnt know how then why would you even contemplate it.
Hope this helps.
yeah.. but my understanding is that ITWV is for future year?
which means i cant really have alook at the interest paid on my bank statement as i have variable loan - the rates has changed since then?
do I hv to adjust this to current variable rates in the market.
yeah? unsure... as this is my first time filling this form.
which means i cant really have alook at the interest paid on my bank statement as i have variable loan - the rates has changed since then?
do I hv to adjust this to current variable rates in the market.
yeah? unsure... as this is my first time filling this form.
You need to make an estimate. Err on the side of caution and try to calculate your annual interest expense based on a figure half a percent or so lower than your current rate. Slightly underestimate your other expenses, too, if you want to give yourself a small buffer. That way, you get the benefit of the ITWV throughout the year AND a small return as a bonus at year end.
Works for me
child support and lowering income
How does this affect child support, or does it not
What if you get to a 0% tax status and pay child support
Do you now earn no income
Or do they base it on your earnt income before deductions
If you earn an average wage and then have a number of neg properties do they add your income plus the rents as income, or take your end of year income and add back the neg gearing benfits only
How does this affect child support, or does it not
What if you get to a 0% tax status and pay child support
Do you now earn no income
Or do they base it on your earnt income before deductions
If you earn an average wage and then have a number of neg properties do they add your income plus the rents as income, or take your end of year income and add back the neg gearing benfits only
There are two sections in the ITWV application for including depreciation.
One section for Buildings depreciation & another section for Fittings/Fixtures depreciation.
Hope this helps.
I queried this with the Child Support Agency. They assess your income based on your taxable income per your Tax Return, but have a mechanism whereby they add back losses from property investments (I assume losses from other investments, too, but I only queried property).
Yes the Family Assistance Office also uses the same method for calculating our Annual Child Care Assistance , & Family Tax Benefits - that is they add back losses for calculating benefit eligibility purposes.
Hope this helps.
Thanks Rixter. That was a bit of a silly question. I suppose I was getting more at the point of how one accumulates enough equity to be able to manage the cashflow of a large enough portfolio to equate to $200K plus in deductions.
I mentioned "capitalising interest" as this I see would be my only way of being able to manage the cashflow of a portfolio big enough to have such large deductions only a few years into my property investing career.
