IP Deposit bonds deductible ?

[Rolf Latham]

Hi all

The great Today Tonite has spoken.

According to a story this evening bonds are deemed a borrwing cost and are therefore depreciable.

Most of my clients have had advice to the contrary.

Opinions please ?

Ta

Rolf

 

[Robert]

Get a really good accountant and have the ATO produce a private ruling.....


hehehe

Cheers
Rob

 

[geoffw]

Can you expand please Rolf? Do you have a URL?

(Are we talking deposit bonds, cash bonds, or something else?)

 

[Lotana]

Rolf,

I'm trying to think logically at 1 am. How can deposit bond (DB) be classified as borrowing expenses if in theory you can pay DB at exchange and pay full cost in cash at settlement? DB is in fact very similar to an insurance contract where the issuer of the bond guarantees that they will pay the vendor your deposit if you fail to settle.

Say cheese

Lotana

 

[DaleGG]

Hiya Rolf

You know my thoughts from previous discussions on the old forum but I shall mention them again here: the deposit bond is not tax deductible and nor is it a borrowing cost to be amortised.

It is a cost of buying the IP and as such it can reduce any CGT later on when the property is sold.

Sorry to rain on the Today Tonite parade

Have fun

Dale

 

[Rolf Latham]

Dale

I knew that, but it shows you what a load of c**p these information shows put out.

I saw it basically as a paid advertorial for the bond company, of course I could be very wrong.

Makes you wonder how much "research" they actually do

ta

Rolf

 

[Waverlybay]

More media hype ... seems like there are a few people treating the costs as deductible !

http://www.todaytonight.com.au/stories/358031.html

 

[Rolf Latham]

Thanks for the URL WB, thats the show I was referring to last nite, twasnt the other squeeky clean one after all hehehe.

Ta

rolf