Irreconcilable differences
- Thread starter gooram
- Start date
That's a decent option, use the profits from the sale of the PPOR to pay down the loan on IP1 such that the two are essentially equal, split the remaining profits and take 1 IP each.... why didn't I think of that?
That sounds fair Lizzie. But my solicitor said that ladies have a right to change their mind (expecially when it comes to money).
Cheers,
Bazza
Dear Gooram,
You two together for 5 years - it is not a esay thing and I think it should have something to cherish. I like to say few words if I in your boots.
1. Fair valuation on all things. Get 2 or 3 qualified valuers (you and your partner have to pay for that) to do the valuation, then do an average for the value for both of you to agree. Do not guess -- it hurts either party.
2. As you said, your partner might be in better financial position. It is fair to give her another extra 5%-10% on the total value (if both of you agree).
3. You or your partner have to pay the capital gain part on the transfer --- does not matter you sell or not.
4. Get all costs done, stamp duty, cgt...
5. have a nice break up. Who knows whether you two come back or not. Like Kylie with her old boyfriend...
You two together for 5 years - it is not a esay thing and I think it should have something to cherish. I like to say few words if I in your boots.
1. Fair valuation on all things. Get 2 or 3 qualified valuers (you and your partner have to pay for that) to do the valuation, then do an average for the value for both of you to agree. Do not guess -- it hurts either party.
2. As you said, your partner might be in better financial position. It is fair to give her another extra 5%-10% on the total value (if both of you agree).
3. You or your partner have to pay the capital gain part on the transfer --- does not matter you sell or not.
4. Get all costs done, stamp duty, cgt...
5. have a nice break up. Who knows whether you two come back or not. Like Kylie with her old boyfriend...
That's what I did when my ex and I split after 20 years. I offered to buy out his share in the home for half of the assessment (less LOC), or he could buy me out using the same conditions.
I'm happy I was able to buy him out, cause I knew the property was worth a lot more than that.
So you are saying by transferring property 1 into my name and property 2 into her name, we would each have to pay respective CGT on half of the value?
For IP1 for example, if we value it now and it has a paper gain of 200k, I would have to pay CGT on 100k?
This doesn't sound right, because when I go to sell it, wouldn't I have to pay the CGT on the total. If not, how is the CGT calculated when i sell?
I know that when a marriage breaks up and you fill out a consent order. You will be exempt from CGT on your IP. If you sell your PPoR split what is left after paying out mortgage and take one each of the IPs as your new PPor.
I have done this in my last marriage, he kept the house and I got the little IP and as it was a family court matter it was except from CGT. I suggest you look at the family law court web site as that will help you a lot.
Yes but we don't want to go to court obviously. So how do we obtain official CGT exemption without going through it formally.
I've searched the WA family law court site, it's not very helpful at all (apprantly, like everything else, WA has to be different).
I think the best next step would be to see a family law talking guy.
Thanks for your input
I've searched the WA family law court site, it's not very helpful at all (apprantly, like everything else, WA has to be different).
I think the best next step would be to see a family law talking guy.
Thanks for your input
If your relationship is still amicable ... you could look at having her buy you out of the business (get it valued by a business broker) from the proceeds of the sale of your PPOR
... then convert the two IP's into tenants in common titles ... hang on to them and make your business partnership try and outlast your personal partnership ...
Or then again, maybe I live in Na Na land
... then convert the two IP's into tenants in common titles ... hang on to them and make your business partnership try and outlast your personal partnership ...
Or then again, maybe I live in Na Na land
see a solicitor
i totally agree. you MUST see a solicitor to ensure it is documented properly. you mentioned you aren't married, so there are different laws that apply to you (so the family court website may mislead you somewhat). the law for defacto couples is different in every state and in most, if you don't get it documented (in most states it must also be signed off by a lawyer) then it will come back to bite you later because the deal may not be binding and you won't get the same tax relielf
GO SEE A FAMILY LAW/DEFACTO LAW SPECIALIST!
i totally agree. you MUST see a solicitor to ensure it is documented properly. you mentioned you aren't married, so there are different laws that apply to you (so the family court website may mislead you somewhat). the law for defacto couples is different in every state and in most, if you don't get it documented (in most states it must also be signed off by a lawyer) then it will come back to bite you later because the deal may not be binding and you won't get the same tax relielf
GO SEE A FAMILY LAW/DEFACTO LAW SPECIALIST!
Back to one of my original questions... anyone have any thoughts?
For the two IPs that we have, we are taking one each, that is definate.
After having them valued, one has about 30k more equity than the other, but it also has a much larger loan, so the holding costs are about 8k per year as opposed to the other property which is about 1k per year. Should the holding costs be taken into account for settlement?
i.e. should whoever gets the property with more equity, pay out the other to make the equity even, or do you think it's fair to say that the extra holding costs cancel out the additional equity?
I'm of the opinion that the latter is more than fair, given that the saving the other person makes on the holding costs, could be used to increase the equity and make the two props even in a couple of years.
I suppose the courts would look at our net assets, and split it down the middle, therefore, loan maintenance is not taken into account...
It's fiddly, is this just a matter of what we both think is fair?
For the two IPs that we have, we are taking one each, that is definate.
After having them valued, one has about 30k more equity than the other, but it also has a much larger loan, so the holding costs are about 8k per year as opposed to the other property which is about 1k per year. Should the holding costs be taken into account for settlement?
i.e. should whoever gets the property with more equity, pay out the other to make the equity even, or do you think it's fair to say that the extra holding costs cancel out the additional equity?
I'm of the opinion that the latter is more than fair, given that the saving the other person makes on the holding costs, could be used to increase the equity and make the two props even in a couple of years.
I suppose the courts would look at our net assets, and split it down the middle, therefore, loan maintenance is not taken into account...
It's fiddly, is this just a matter of what we both think is fair?
Hi Gooram, Sorry to hear your problems. I think everything should be taken into consideration including potential capital growth of the IP's.
Has your partner thought as deeply as you have on the financial/asset split or is it up to you to present a proposal of the deal?
If it is up to you then get the free consultation from the lawyer, decide on a fair outcome and give your partner the choice of IP/deal to take. Like Lizzie says if it's you cutting the cake and your partner is choosing then it will be fair in both people's mind.
Good Luck, Ian
Has your partner thought as deeply as you have on the financial/asset split or is it up to you to present a proposal of the deal?
If it is up to you then get the free consultation from the lawyer, decide on a fair outcome and give your partner the choice of IP/deal to take. Like Lizzie says if it's you cutting the cake and your partner is choosing then it will be fair in both people's mind.
Good Luck, Ian
i think that's fair - as long as whoever didn't make that offer gets to choose which house first (the cake thing).
otherwise - out of the other assets you have, can they be divided with one party getting $15k more of something?
yep I did the "cake" thing, and she chose the one with the lower amount of equity but still wants me to give her 15k on top. Surprise, surprise!
There are other assets and cash but I want to leave that out of this. My argument is that the one with the extra equity comes at a cost and therefore you should not have to pay the other the 15k.
Is anybody with me?
There are other assets and cash but I want to leave that out of this. My argument is that the one with the extra equity comes at a cost and therefore you should not have to pay the other the 15k.
Is anybody with me?
yep I did the "cake" thing, and she chose the one with the lower amount of equity but still wants me to give her 15k on top. Surprise, surprise!
There are other assets and cash but I want to leave that out of this. My argument is that the one with the extra equity comes at a cost and therefore you should not have to pay the other the 15k.
Is anybody with me?
When my ex and I divorced, we decided the children stayed at the house. Who ever lived with the children had free use of the house (and no child support)After the children finished school, the house was to be sold and proceeds divided.I stayed.
Well, instead I got the property buying bug and needed access to my equity in the house.
I wanted my ex to buy my share or allow me to buy his. I decided to use the tax assessment as the value.I gave him the option.
He wanted me to buy him out.(Bet he wishes he did it the other way....place has increased in value by 50% in 2 years)
He seemed happy about it at the time anyways.
Is anybody with me?
i'm with you ... can't have you cake and eat it too ...
yep I did the "cake" thing, and she chose the one with the lower amount of equity but still wants me to give her 15k on top. Surprise, surprise!
There are other assets and cash but I want to leave that out of this. My argument is that the one with the extra equity comes at a cost and therefore you should not have to pay the other the 15k.
Is anybody with me?
Hi gooram,
I agree with you, but I'm not your ex. You better start treading carefully, because it could turn nasty very quickly and she will take you for as much as she can. The Courts favour women very heavily so you need to be careful. Her lawyer would have told her this already.
Maybe suggest to her that if she wants the 15K on top, that you continue to split the costs of holding the properties evenly. When she sees she may have to pay a few more grand in costs each year she may back down. If she looks like she's going to start getting nasty, just give her the 15K but ONLY IF it looks like it's going to go south, because if it does go to the courts, you're gonna lose a lot more than 15 grand.
Mark
