negative gearing a newly built property

[WebBoard]

From: Eddy Morris


re my previous posting. I would like comments on the following 2 options re building the house. I can

1. Go the normal way and spend $120K with a local builder and build the house, or
2. I can owner build, use the same builder to do everything but pay him "cash".
By using option 2, I would save $20K, so would prefer to do it that way.
Comments?
thanks
Eddy

 

[WebBoard]

Reply: 1
From: Sergey Golovin


Eddy,

You can also subcontract those jobs to few different builders (walls to one, roof to the other, electrical, etc.) and save even more by using your owner builder licence.
Life span of the licence is 7(?) years from the time you put first lot of cement down.

Serge.

 

[WebBoard]

Reply: 1.1
From: Eddy Morris


Yes, true and that's doing it the "legal" way. The truth is I don't have time to do it AND I live some 5 hours from when I want to build so I was going to use my relative (local builder) but pay him cash for the job. That way i'm avoiding some GST and (I think) "falling fowl" of the law.

 

[Mr. Fabulous]

Reply: 1.1.1
From: Mark Laszczuk


I'm not an accountant or solicitor or anything, but my guess is that you can pay him any way you want - cash, cheque, pigs even. It's up to him to declare the income, it's irrelevant how you paid it. But that's just an opinion.

Mark
'no hat, some cattle'