Costello says No to axe gearing...
- Thread starter Alan H
- Start date
Very realistic view I think.
I would be hard for the Governement to take away negative gearing and not damage the housing market
(particularly in areas where the rental returns are low).
They also don't want to damage their own property portfolio
and ofcourse they want to be re-elected....
Bill
I would be hard for the Governement to take away negative gearing and not damage the housing market
(particularly in areas where the rental returns are low).
They also don't want to damage their own property portfolio
and ofcourse they want to be re-elected....
Bill
There is also the fact that about 90% of polititions have at least one negative geared property.
l read this in a survey about 2 years ago.so l think we can rest assured that where their money is concerned not a lot will change tax wise.
The government could not afford to chase investors out of the property market anyway.The govt can,t cope with the housing situation for the "poor" now.
I think this maybe ONE PROMISE they will keep.
cheers yadreamin
l read this in a survey about 2 years ago.so l think we can rest assured that where their money is concerned not a lot will change tax wise.
The government could not afford to chase investors out of the property market anyway.The govt can,t cope with the housing situation for the "poor" now.
I think this maybe ONE PROMISE they will keep.
cheers yadreamin
After the last back flip on negative gearing, I think I agree with this
Get your filthy hands off my negative gearing
Borrowing funds to generate income is a legitimate business practice.
If I borrowed funds to purchase an office building or shopping centre to lease out how is this different to doing the same for a house ?
How does anybody plan when the govt has the ability to change the fundamental principles of tax law .
I know thats the way it is and I have to accept it, but it doesn't mean I'm happy about it.
Borrowing funds to generate income is a legitimate business practice.
If I borrowed funds to purchase an office building or shopping centre to lease out how is this different to doing the same for a house ?
How does anybody plan when the govt has the ability to change the fundamental principles of tax law .
I know thats the way it is and I have to accept it, but it doesn't mean I'm happy about it.
The general rule of thumb is that you can claim expenses incurred in the process of generating taxable income. If you're running at a loss, you're allowed a reasonable time frame to become profitable eg. 3 to 5 years. If you bought a commercial property such as office building or shopping centre, you'd be either positive geared (ie. making a taxable profit), or going broke.
On the other hand, investors with negative geared properties tend to make tax losses, without any expectation of ever making a taxable profit. The ATO has been very lenient in this area, perhaps because it's cheaper for the Government to allow negative gearing tax deductions than to build public housing.
Same rules except where GST and depreciation of the building is concerned.
You retire either by yield and pay tax on the profits or retire by CG and pay CGT on the sale of assets or borrow more from your asset base to provide income tax free. Either way works for the gov as you are pension free and providing a service they don't want too.
bundy
