Claiming tax if you lease then sublease property back.

[atti]

Ok i bought a new house earlier this year with 3 bedrooms,
i lease it to a cousin 300 a week she uses 2 bedrooms and pretty much rest of the house and also uses spare room to run her home businesses.

house is worth 400 pw. i use 1 bedroom only.

how much percentage of the house can i claim eg. depreciation, IO loan from bank 13000 $ payed in the year2012/2013.

 

[pinkboy]

Pay your rent cash!

Claim 100%.

Pray you don't get caught!



pinkboy

 

[atti]

no i dont want to get into trouble later down the track, plus she doesnt pay me cash comes straight from her paying job which leaves a digital trail...

would be good if she pays me cash and i just use it as ppor but then again i cant use that cash income to built more properties.

 

[pinkboy]

You were a deduction expert last week. What happened?

pinkboy...the facetious

 

[atti]

just double checking what i can claim if someone has similar setup since i am doing it myself this year through etax.

 

[Paul@PFI]

Rent

Your deductions will all need to be apportioned. Including interest, rates, part of loan fees, rates etc...Even elect, water etc. Problem is your cous seems to have run of house and apart from shared kitchen laundry etc seems she uses the rest. Its possible its 3/4 deductible but you havent given much info. The rent being paid certainly isnt just a bedroom its more like 3/4 of house. Hard to see how it would be more than 3/4.

There is good guidance on the two apportionment concerns you mention:
1. Only part of the prop earning assessable income (ie you reside in it); and
2. Non-commercial rent if its an issue.

ATO Publication on Rental Props is NAT 1729. Their new site site sucks big time and its a pain to find things. Google is all old links too. Google now powers ATO - Go figure !! When you find it (even last years) page 8 has examples etc.

Paul
www.pricefinancial.com.au