Property Tax… let’s have a real conversation about it folks!

Because if we’re being honest— even with 40-odd years of industry know-how between us (and an accounting degree wedged in there as well) — there’s still a bit of property tax knowledge we could use too.

And if you’ve listened to us for a while now, you’ll also know that, when it comes to tax, we’re only allowed to talk about “Statements of Fact” — as we’re not qualified to give advice in this area.

So it’s GREAT NEWS that today’s guest is absolutely, well and truly, qualified to dish out advice on Capital Gains Tax, Depreciation Benefits, Trusts, Ownership Structures and ALL of the property tax perks & pitfalls!!

In fact she’s SO qualified and willing to share what she knows, that we stole a couple of hours of her time to deliver you TWO EPISODES – today, being Part One.  😉 

Who’s our epic guest?

Oh, “just” The #1 Property Tax Expert in Australia… Julia Hartman!!!

To give you an idea of the calibre we’re working with here — Julia is the Founder of BAN TACS, a co-operative of Accountants which has been helping thousands of Australians navigate the world of tax since 1992!! She has a Bachelor of Business and is a Chartered Accountant (CA), Certified Public Accountant (CPA) and a Registered Tax Agent.

Ben’s also been admiring her work since “way back in the day” when she first began writing tax articles for Australian Property Investor Magazine, sharing insights that so many property investors out there simply didn’t know about.

PLUS, because we knew she was coming, we threw it out there for our listeners to ask us the most pressing Tax Questions they had — and Julia’s going to answer plenty of these today and next week.

Today’s round is on Capital Gains Tax!!

But, of course, we also had quite the week, including….

• Federal Budget ANNOUNCEMENT on Tuesday night (2^nd April 2019)
• DATE FOR NEGATIVE GEARING — 1^st January 2020
• RBA Cash Rate Announcement for April
• Comments on Negative Gearing from Chris Bowen, Shadow Treasurer of the Labor Party, on ABC’s Insiders: The Interview (Listen to ABC’s audio here)
• And Ben is in Canberra to present at the Housing Panel!!!

… SO we’re going to tackle these guys at the START of the show.

And of course, the resources mentioned in this episode are:

• For the ATO table comparison in the Did You Know segment today, head to our Facebook page!
• Also, don’t forget, if you’re in #Radelaide… The PICA meet up in Adelaide – 7:00PM, Tues 9^th April 2019
• The Capital Gains Tax Calculator – Buy it here
• Julia’s article on Airbnb – Click here to read

Today’s Capital Gains Tax (CGT) Questions:

42:38 — Question from Joshua
If I have purchased a block of land but choose to on sell it prior to settlement, but the new purchasers don’t settle, would I be taxed on the 10% deposit the new purchaser pays in the event that they don’t follow through with the sale, leaving me to settle on the land?

44:13 — Question from Brendan
What is the threshold between claiming all renovations/maintenance in one year, vs having to stagger it over “X” years?

48:50 — Question from John
If 5 family members own 1 investment property, can the income be all directed to 1 person or must it be 20% each?

50:34 — Question from Alisdair
Hypothetical question. I have a PPR and I decide to build an extension and use it to rent out Airbnb or lease to a tenant. Is the deductible percentage based on square metres only? Any other considerations that should be made, such as a common garage? Will the build be able to be depreciated as a capital works deduction? When I sell my PPR, will it only be the same square meterage that is subject to CGT? The answer to these questions makes it clear if it is a worthwhile proposition.

58:16 — Question from Andrew
When selling an investment property, how does the depreciation you have claimed on the investment property affect how your capital gains tax is calculated?

1:01:47 — Question from James
Are Stamp Duty and Capital Gains Tax affected for first home buyers when purchasing a property for the purpose of investment vs owner-occupied?  Also, if the property is initially purchased as an owner-occupied property but later turned into an investment property what is the tax outcome of this both throughout the life of property ownership and when the property is sold (further down the track).

1:03:37 — Question from Karen
If I move out of my PPOR and turn it into an investment, then sell it after 6 years, how is CGT calculated?

1:06:27 — Question from Josh
Can I claim any ongoing CGT discounts if I move and rent out my PPOR if I move into a rental myself?

1:08:09 — Question from John
I will be looking at losing close to $80k on an investment property I have held onto for 12 years. Just wondering how long I can carry this capital loss over for? And how the whole offset process works… (i.e. would a $80k profit in the future completely be offset against this loss?)

1:10:25 — Question from Richard
I recently tried to work out how to calculate Capital Gains Tax that I would pay on an investment property but the ATO’s website made it very hard to do this. Is it just a straight 50% of the profit made OR does it matter how long you hold the property for OR does the profit then go into your yearly income and the percentage is worked out that way?