Is this fraud?
- Thread starter Samwise
- Start date
Sam, I must say I did not completely follow the original post or the comments, as this is very much an "off the post situation". I bought a block of land, and the same day I signed, I then entered into a contract to sell half the land, with settlement due when the subdivision, and title arived. I had letter from 3 agents, giving a value, as at the date of the contract, and that covered ATO, and the local State Revenue Office. So my thoughts are, look at the wording of your agreement, at the date of entering into it, and the conditions, in particular when, the change eventuates. If all worded correctly, it may work for you. Please keep us informed.
I'd call it tax avoidance.
Quite legal too.
But, as Alex has illustrated; can have other problems.
Not so sure I'd pronounce it as quite legal, it's highly likely that a typical case officer at the ATO would consider this to be an artificial scheme to reduce tax, and hence IVA kicks in to disallow the deductions.
Of course the only thing that really matters is what the High Court say about it, but have you got a million bucks to fight it all the way up there? Maybe you could hang around the local courts, hoping to meet your own Lawrence Hamill QC.
I'm sure many people do it, particularly family members who may be buying two identical apartments in the same building, but that doesn't mean it's not illegal.
Cheers
Jonathon
There is no tax that is being avoided, if so what is it?
In fact if they bought in there own name , lived in it briefly rented to couple B,and declared it there PPR there would be no CGT upon sale, if done so under the 6 year rule.
