I am looking at IP 3 through a buyer's agent. My question is - Can the BA fee be tax deductible? and how?
Thanks
Thanks
Buyer Agents fee - Is it tax deductible?
- Thread starter firstmillion
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Ato Id
Yep, last year about this time the ATO clarified the situation by releasing an ID - in the attached.
Yep, last year about this time the ATO clarified the situation by releasing an ID - in the attached.
Thanks.
In layman's terms am I correct in saying that the BA fee is dedutible in the FY of purchase?
NO, that would be exactly incorrect.
You get to claim them when (if) you sell the property.
What if you've paid the initial fee but for whatever reason you don't end up buying a property?
I do wonder why BAs don't try to do something a little innovative with their fees, particuarly when dealing with investors.
For example, insteading of charging an investor $20k for helping them to buy a $400k unit, if they teamed up with a property management company and bundled up their fee in the ongoing property management fee, then perhaps some of it would be tax deductible, thus encouraging more investors to use their services?
For example, insteading of charging an investor $20k for helping them to buy a $400k unit, if they teamed up with a property management company and bundled up their fee in the ongoing property management fee, then perhaps some of it would be tax deductible, thus encouraging more investors to use their services?
I would consider a BA who has such a relationship with a property manager to be less independent.
And Im pretty sure I remember reading in a property magazine an ATO ruling disallowing a deduction of that nature when the finders fee was rolled into property management.
Just borrow the money for the BA and claim the interest. I have used a BA twice now, and have always made at least the fee back as borrowable equity in the first year.
Just borrow the money for the BA and claim the interest. I have used a BA twice now, and have always made at least the fee back as borrowable equity in the first year.
I hadn't heard of this before.... will look into it with the accountant...
Good idea - I think you'll find that you can borrow the money for other expenses, like BA fees, that get added to the cost base of a property: stamp duty, solicitor fees, etc and claim the interest on the loan when you do so.
Hi all,
Are any accountants out there that can clarify this? ie: whether the interest paid on borrowings apportioned to BA fees (in a successful purchase) are tax deductible?
cheers
