Henry Report

Yes, negative gearing was abolished in around 1985. You could offset expenses against the rental income, but if there were excess expenses they were carried forward to the next year (and so on) until all loses were absorbed and the investment started creating an actual income.

That's more or less the system in the UK - the losses on my Central Equity properties just rolled forward. I am now a beneficiary of the system here (to a small extent, don't earn enough) but am amazed by it. Putting aside the fact that most of us here benefit from the status quo, if I were setting tax policy I think that allowing negative gearing on new dwellings only would make more sense, i.e. encourage those whose investment increases the housing stock (much the same intention as FIRB rules re offshore buyers).
 
You can't get margin on spec shares, nor can you claim interest on them in the current year if bought through a LOC. (I'm no tax expert and this is not definitive) There is a test for neg gearing where they must be "income producing" or have reasonable expectations of them becoming so. Can you neg gear vacant land? A tougher interpretation of the "income producing" test could reduce the prevalence of NG.

Hi sunfish,

Thanks for your reply. For the record all my shares produce income and are fully franked. I use them for income and CG and have interest cost against them. I claim the interest. Was this type of scenario affected in 1985 along with the changes to NG on property. I was not an investor at the time and never took notice.:eek:

Regards

MJK
 
Quite fascinating in the numbers of taxes we have... eg: youve got GST, income, CGT, Payroll, Air, Water, Petrol, Alcohol, Liquor, land... feel free to add in as Ive just rattled in a few.
 
After reading that article it seems pretty simple what the solution is.

Sack 80% of the politicians and remove any access they have to their lifetime pension. That should free up a large chuck of money.

Personally I wouldnt mind if they removed negative gearing and all other tax deductions if it meant the existing tax rates were cut in half. Tax system would be so much simpler too.

a) Make sure no more policies are tailored at giving everyone (including dead people and people who've since left the country) $900, because $900 x 22 million = $19.8 billion which is approx 2% of our GDP

b) No more useless money spent on silly insulation programs and what not. Please fix up the basics like roads, hospitals etc before we look at these unnecessary commodities
 
We are overtaxed!

Bernard Salt thinks we're lightly taxed? Perhaps he didn't take into account the total effective tax rate which includes taxes besides personal income tax. I can't remember exactly what it is, somewhere in the 60's percentage wise. To compare, Sweden's rate was only a couple of percentage points higher - but just look at what they get for it. Here we pay taxes and get bugger all for it. There, you actually get some support from the social system (maternity/retrenchment etc), which makes the tax burden just that little bit easier to bear, knowing that you contribute to a system that will be there for you if and when you need it.
 
a) Make sure no more policies are tailored at giving everyone (including dead people and people who've since left the country) $900, because $900 x 22 million = $19.8 billion which is approx 2% of our GDP


actually it was 8.7 million people = ~$7.8 bill*

*if everyone got the full 900, which they didnt. some got 600, some got 250

im not questioning the worth or otherwise, just not wanting to leave misleading figures hanging out there.

http://www.treasurer.gov.au/Display...09/004.htm&pageID=011&min=wms&Year=&DocType=3
 
Thankfully there is no longer death duties! That's right, paying tax when you're dead (well sort of - inheritance tax)!

This is often quoted in the UK where there is inheritance tax - 40% on estates above about £300K (=$500K at today's sad rate), but isn't it the case here that executors have to pay Capital Gains Tax on assets held by the deceased as if he/she were disposing of them? If so, die leaving a £600K PPOR, no tax in Australia, £120K tax in UK; no PPOR, $500K of investments bought when markets were a lot lower, no tax in UK, $$$ in Australia. Or have I misunderstood the system - after 18 months still getting my head around the Aussie way of doing things.
 
Section 94 contributions! :mad:

Grumble, grumble. Just added over $40K to my development...

Oh and all the other "taxes" on bringing property to market. No wonder its not a profitable game for builders anymore.

Cheers,
Michael
 
This is often quoted in the UK where there is inheritance tax - 40% on estates above about £300K (=$500K at today's sad rate), but isn't it the case here that executors have to pay Capital Gains Tax on assets held by the deceased as if he/she were disposing of them? If so, die leaving a £600K PPOR, no tax in Australia, £120K tax in UK; no PPOR, $500K of investments bought when markets were a lot lower, no tax in UK, $$$ in Australia. Or have I misunderstood the system - after 18 months still getting my head around the Aussie way of doing things.

In Australia, if you establish a Testimentory Will trust, your assets can pass tax free to your beneficiary/s. Certainly worthwhile considering if you buy IP's for example and have significant equity. Furthermore, income generated by the assets is taxed at adult rates. This is advantageous for people with young children, who, if they inherited the estate outside a trust situation would need to pay tax at around 66% or so. (approx).
 
Hi all,

ABC News will bring you all the latest from the Henry Tax Review in a web special on Sunday from 2:30pm AEST.

Sounds like the release should be very soon, being 1.50pm now.

There must be some scary bits in there as there will be lots of "Logies" coverage in the media tomorrow. This govt is very good at 'timing' their media releases..:rolleyes:

bye
 
Hi all,



Sounds like the release should be very soon, being 1.50pm now.

There must be some scary bits in there as there will be lots of "Logies" coverage in the media tomorrow. This govt is very good at 'timing' their media releases..:rolleyes:
bye

It had to be on a Saturday or a Sunday. Henry had to be in the country and only just got back recently, like maybe 9 days ago.

The perfect oppurtnity would have been on the friday when the Melbourne Storm story broke 20 hours before hand.
 
Back
Top