Deposit Bond Tax Deduction Timing

[Crispin]

From: Crispin Dobson


I have one investment property in my own name.
I am looking at buying an off the plan apartment, also in my own name, due for completion in 3 to 4 years time, and securing it with a deposit bond (can you believe $5,800 for 48 months?)and also a property advocate's fee of $5000.
Is it possible to claim the full amount as a tax deduction this financial year, or will I have to wait until completion in 4 years time and then amortise it over the following 5 years?

Thanks,
Crispin

 

[DaleGG]

Reply: 1
From: Dale Gatherum-Goss


Hi

Neither are tax deductible as both are involved in ACQUIRING the property and not in HOLDING or OWNING the property.

Both form part of the capital costs when you eventually sell the property and thus will reduce your tax on the capital gain.

Dale

 

[stirling]

Reply: 1.1
From: Stirling Reid


Dale please correct me if I am wrong.
If instead of using a deposit bond, you borrow the deposit at 6% and the developers pay 4% on the deposit (some pay interest, some don't) then the 6% is tax deductible as it is used for income producing purposes (the interest) and of course the interest paid is taxed. This may work out cheaper than a deposit bond.

Stirling

 

[DaleGG]

Reply: 1.1.1
From: Dale Gatherum-Goss


Hi

Yes, I would agree with you.

Dale

 

[Jerry Maguire]

Reply: 1.1.1.1
From: Jerry Maguire


hi crispin
how much is the amount of money that you are getting is it 10% or 20% of the purchase price?
$5,800 for 48 mths thats a lot of money to pay for deposit bond.
have you try a bank g'tee instead cos they are a lot cheaper than deposit bond.
which company are you going through to get your deposit bond?
the max i've pay for bank g'tee is about $500 dollars for 18mths.
keep us posted on how you go crispin

 

[Ross Sondergeld]

Selling fee rebate? Where did it go?

Reply: 2
From: Ross Sondergeld


Hi Crispin,


Selling fee rebate ??? Where did it go ???

You Said, "I am looking at buying an off the plan apartment, also in my own
name, due for completion in 3 to 4 years time, and securing it with a
deposit bond (can you believe $5,800 for 48 months?) and also a property
advocate's fee of $5000."


Normally, agents get a FEE for introducing a buyer to property.

Therefore... Does your "property advocate" (i.e. buyer agent) rebate the
selling fee (from the transaction) to you. For example...

Selling price $ 300,000
Agents fees $ 9,000 (Who got it and where did it go?)


For example, when i help people to buy... we buy directly from the
developer. And i collect the selling fee ($9,000 and i rebate this to the
buyer. Then i get paid my agreed fee of say $5,000.)

Basically, you get an extra $4,000 in your pocket.


DID YOUR "PROPERTY ADVOCATE" DO THIS ???


I'd love to know where the selling fee went and who got it !!!





Ross Sondergeld ~ Buyer Agent

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
" Imagine buying real estate the easy way...
...with a Buyer Agent on your side!!! "

Buyerside Real Estate Mobile 0412 289 464
Office 9b, 34 Glenferrie Drive Office (07) 5562 1555
East Quay Corporate Park Fax (07) 5562 1248
Robina QLD 4226, Gold Coast [email protected]
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