Making my PPOR a sharehouse

[jackula]

I can also drive my car 120 km/h down suburban streets with a blood alcohol level of 0.32; nobody will physically STOP me from doing it. That doesn't make it legal.

But how are they going to find out? I mean on the road it's quite easy with under cover police cars, speed cameras and the occasional chance of causing traffic chaos. But in a house? The only way the ATO can find out is if they follow you home which I doubt they'll do.

Um, it is, and they do... they tell you what the laws are, and impose huge penalties if you're found to have lied. You sign your tax return stating that all the information is correct. Surely everybody knows that fraud is a crime, don't they?

Actually penalties aren't huge. I knew someone who failed to claim tax on their 500k annual income. She got caught and was only forced to pay back half of that, in the end it worked out to be about the same as what she would have paid in taxes if she did it properly.

 

[Leikela]

But how are they going to find out? I mean on the road it's quite easy with under cover police cars, speed cameras and the occasional chance of causing traffic chaos. But in a house? The only way the ATO can find out is if they follow you home which I doubt they'll do.

Well if you do it knowingly, then that just makes you a criminal, whether you're caught or not.

 

[jackula]

Well if you do it knowingly, then that just makes you a criminal, whether you're caught or not.

No it does not, it just makes me "dodgy", otherwise everyone would be criminals.

 

[The Y-man]

1/ Claim 100% but claim your PPOR is elsewhere (say your parent's house).

This great if you have some place else in the same city which you can claim as your PPOR and that you think the rental income exceeds the increase in property value, because if you eventually decide to sell you'll be hit with CGT.

Ethics, legalities, and what not aside:

As you state, you will be up for CGT, and will give up a CGT free status for a PPOR. If you have some place in the city which you claim is your PPOR, will it sit empty (I guess not an issue if you own it outright and don't mind it sitting idle)? You can't rent the second place out without repercussions, as 1. your bills need to be in your name (as proof of ppor) 2. can't claim costs on that property (eg interest, maintenance)


You can't claim your parent's place as PPOR without transferring the ownership to you (i.e. sell to you, with associated costs), and then they would be "propertyless". Otherwise, you need to rent from them, so you completely lose any benefit of a ppor.

So all things considered, I think there is no benefit doing option #1, as it all boils down to "gotta pay the tax one way or the other".

The Y-man

 

[Perp]

No it does not, it just makes me "dodgy", otherwise everyone would be criminals.

Am I on "Candid Camera" or something? Please tell me people like this don't really exist (at least not in any significant numbers).

 

[Leikela]

Am I on "Candid Camera" or something? Please tell me people like this don't really exist (at least not in any significant numbers).

Yes they do, and it's sweet WHEN the ATO catches up with them. I know of someone the ATO caught up with, and not only did he have to pay $30K in tax but also $20K in penalties. Of all the businesses to try and screw over, the ATO is not one of them, trust me.

 

[wylie]

But how are they going to find out?

They are probably reading this forum .