Paying Rent and Leasing PPR

Discussion in 'Accounting and Tax' started by MCS, 7th Apr, 2009.

  1. MCS

    MCS Member

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    I own a house which I rent out and earn rental income. I also rent an apartment for a greater value to the rent earned. I am now being hit with Land Tax, and Income Tax Assessment.

    Is there anyway I can avoid paying these taxes. Just because it is not my 'real' PPR, it is the only house I own. Doesn't the rent I pay have any weight whatsoever to this?

    Thanks
     
  2. Pushka

    Pushka Member

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    No way to avoid Land Tax. You are not living in the house you own, it is an investment, so no exemption. Paying rent to live in elsewhere is considered a private expense and not deductible. You are earning rent from renting out the one you own, so you pay income tax. Check that you are receiving all the deductions you are entitled to, like depreciation and interest deductions.
     
  3. sunshine

    sunshine Taking a ride...

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    I believe that your PPOR is Land Tax exempt. Sounds like this is the case.

    Sunshine
     
  4. Pushka

    Pushka Member

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    Only when you live in it. MCS doesnt, they rent it out. It is not their PPOR!
     
  5. sunshine

    sunshine Taking a ride...

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    As we have done this in NSW and QLD, I decided to further research this.

    IF this is your PPOR (regardless if you live in it or not as per the 6 year rule) then exemptions can be claimed.


    Vic

    http://www.sro.vic.gov.au/sro/SROWe...52E0004D132/$File/publication-LTX-05_2009.pdf


    NSW

    http://www.osr.nsw.gov.au/taxes/land/exemptions/principal/

    QLD

    http://www.osr.qld.gov.au/land-tax/exemp-reb-land-tax/index.shtml


    Thresholds are still in place though, so if it is above the threshold some land tax will still be payable. Only 1 PPOR Aus wide can be claimed.

    The property needs to meet PPOR criteria as per the above threads. If not then that is a different matter altogether.

    Sunshine
     
    Last edited: 8th Apr, 2009
  6. Pushka

    Pushka Member

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    Well, as we dont have any idea of time frames that the place was occupied by the owner, and has been rented out we need further info from the OP. In SA, someone has even been charged Land Tax when their home was burnt down in a fire, and they needed to rent while it was being rebuilt. And there was no way they could get out of paying it, yet no way of living in it!
     
  7. Propertunity

    Propertunity Real Estate Buyers Agent

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    B@st@rds! :eek:- I'd pitch a tent on it and the port-a-loo would be already onsite because of the builders.:D
     
  8. Pushka

    Pushka Member

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    Welcome to the SA Government. They are a mean spirited lot, they have no heart! Kevin Foley (Treasurer) is a bully, dont know how he gets away with it. The story above did make the news here. Land Tax will be an election issue next year; Big investment people are starting to look to other states in Australia for large scale commercial holdings; in SA our stamp duty and Land Tax rates are above anywhere else in Australia. One guy was in the paper last week - he has just bought a new commercial complex in Queensland, and said if he had done this in SA, then Stamp Duty would have been over $100k and each year, Land Tax over $300,000 :eek: In Queensland it will be half that!