Guest nev_n_angie Posted March 7, 2007 Share Posted March 7, 2007 Hi Is there anyone who has any knowledge on the best way to 'avoid' huge Tax Biils? We have sent over a sum of money that we were going t invest in Property to Rent out. We can still do this as the Rental Market looks good at the moment, but we were only looking at a short term investment (3-4 years). Ideally, we wanted to them sell the properties and buy our own house to live in - out right. The problem I can see is that the rental market is very good because people are finding it difficult to geton the property ladder there - who will buy the houses/apartments?? We do not want to keep the money in the Bank as we will be paying approx 47% on the interest earned in Tax. We have already been 'stung' with a hefty Tax witholding fee from our Aussie Bank Account. We have reclaimed some of that back by being non residents, but I know as soon as we get there, this will change. If the money is invested in Property, then that's a loop hole that we can avoid so much to be paid. I'm sort of starting to confuse myself now with this - is there anyone who has any knowledge on this - simplified of course! lol We rented property here and I knew the laws and regs inside out - very simple! Unfortunately, things are very different in Australia and I think it's more a fear of the unknown. Any advice would be appreciated Angie Link to comment Share on other sites More sharing options...
Guest BullcreekBob Posted March 8, 2007 Share Posted March 8, 2007 Unfortunately, things are very different in Australia and ... G'day Angie You've hit the nail on the head there. Yes, things are different in Australia, but at least you've recognised that which puts you a long way ahead of many people who seem to come over here and think that it will be just like "back home" but with sunshine. Capital Gains Tax, like all forms of income tax is a bit of a pain but the way I see it, is that you only pay it, when you are earning money. If you've got a huge CGT bill, you must st least have made a huger amount of money. Unless you've done something really fundamentally wrong, CGT will not be more than 22.5% of the gain you make. You will only pay $45,000 in capitals gain tax if you make $200,000 so I'd suggest you look on the bright side, at least you're making money. Cheers Bob in Bull Creek Link to comment Share on other sites More sharing options...
Guest spock Posted March 8, 2007 Share Posted March 8, 2007 I asked a question in a different thread, but may be related. My endowment is due to mature (with stunted growth!) in 9 years time. 2 questions for Bob: 1. Does it matter that this is tax free in the UK to pay for my mortgage? 2. Does it matter that tax is paid during the course of the endowment? 3. If not, would I pay tax on the whole sum, or just on the profit (after all I've been paying money into int for 16 years so far and so that part of it is certainly not capital gains imho!) Thanks, Spock Retired Star Trek fan Link to comment Share on other sites More sharing options...
Guest spock Posted March 8, 2007 Share Posted March 8, 2007 Yes it was 3 questions - I thought of another one half way through! Spock. Link to comment Share on other sites More sharing options...
Guest nev_n_angie Posted March 8, 2007 Share Posted March 8, 2007 Hiya Bob - thanks for that info. Mine's a question of what's best to do with the money? Would it be beneficial for me to buy the house we eventually want to live in - out right?? I know that If we rent it out before we move into it, there are a number of Tax breaks - depretiation and porbable negative gearing etc - BUT - if we were to get a mortgage and pay half of the value of the house - then rent it out - would that be better on the Tax side of things??? Are there many people in Australia who do the cash buying side of things??? We've been very fortunate with property over here and have sold up to come across - all of the money made is now in COM BANK and earning interest which we are paying 10% as non residents. Hubby is due to receive lump sum from Royal Navy as well and will be joining RAN in September. This means that we will be living in defence Housing, so rather than leaving the money in the Bank - we were looking at getting it to work for us. I think I'm probably going round in circles and not making much sense at this point - so apologies!!!!!!!!!!! AARRGGHHH!!!! Spock - I know nothing about endownments - I do know that you have specific amount of time to bring savings etc into the country - not too sure what it is though. My Hubby will be receiving Armed Forces Pension from UK everymonth - we are chosing for it to be paid as a gross amount and then just paying the tax in Oz every year. It will autimatically get added on to household income and we will more than likely pay 47% Tax on it at the higher end of the Tax Rates. Hey Ho! At least it wont be to My Brown - or whoever it is by then! Best of luck with all of it! I think that the longer time goes on - the more I'm confusing myself! Angie Link to comment Share on other sites More sharing options...
Guest oz migration Posted March 15, 2007 Share Posted March 15, 2007 Hi Angie You need help in two main areas - investment property strategy and accountant / financial planner experienced in international settlers. I have a JV set up that will support the first matter called Australian Property Wealth Strategists (APWS) and we deliver weekly forums (Skypecasts) on residential investment property in Australia : https://skypecasts.skype.com/skypecasts/skypecast/detailed.html?id_talk=548848 I can suggest exc planners and liase with you in the forum or PM as you wish. Kind regards Chris Link to comment Share on other sites More sharing options...
Guest nev_n_angie Posted March 15, 2007 Share Posted March 15, 2007 Hi Angie You need help in two main areas - investment property strategy and accountant / financial planner experienced in international settlers. I have a JV set up that will support the first matter called Australian Property Wealth Strategists (APWS) and we deliver weekly forums (Skypecasts) on residential investment property in Australia : https://skypecasts.skype.com/skypecasts/skypecast/detailed.html?id_talk=548848 I can suggest exc planners and liase with you in the forum or PM as you wish. Kind regards Chris Hi Chris Thanks for that! I will have a look! Our main concern is that if we buy to let for 3 or 4 years - would the properties re-sell easily and would their be a decent enough return to make it worhtwhile?? I will look into the link Many Thanks again Angie Link to comment Share on other sites More sharing options...
Guest luckyhorse Posted March 16, 2007 Share Posted March 16, 2007 Hi Ange, I agree the tax situation is very confusing initially. Having spent the first 34 years of my life not giving a thought to tax, it seems that for the last 12months I have thought about nothing else. In my experience here I can recommend paying the extra for expert advice and forward tax planning from a qualified tax accountant rather than the cheaper option of just getting your returns completed by one of the large tax companies at the end of the financial year. These companies basically use clerks rather than accountants to fill in the forms therefore they don't have the indepth knowledge as regards depreciation costs etc. Working retrospectively irritates me aswell....I like plan! No use telling me at the end of a financial year what I SHOULD have done...tell me what I need to do now for the future. I'll PM you the name of my tax accountant. She's very meticulous and knowledgable and I like the fact that she's fairly conservative in her strategies. You may want to google a bloke called Rory O'Rourke. He's an estate agent in Perth who does seminars on wealth creation and has written a book entitled 'Born Free-Taxed to Death' Personally I find his strategies a little too aggressive on the whole but he raises some very interesting points and it certainly has helped with my own tax planning by taking the nuggets of advice that I think are sensible. Overall I think that the Aussie tax system serves you well compared to the UK. There are heaps of incentives/tax breaks for the investor. But as I mentioned before, you get what you pay for as regards advice/expertise. Hope this helps Louise Link to comment Share on other sites More sharing options...
Guest luckyhorse Posted March 16, 2007 Share Posted March 16, 2007 Just did a google myself on Rory O'Rourke and found him discussed on a forum. Interesting reading.... Here's the link : http://www.somersoft.com/forums/showthread.php?p=133893 Cheers Lou Link to comment Share on other sites More sharing options...
Guest oz migration Posted March 18, 2007 Share Posted March 18, 2007 Hi Angie At present in SE Qld with the right and select property purchase, property is doubling in 7.2 years. So for a $375,000 purchase in 7.2 years it will be worth $750,000 approx and 100% equity attained. Very attractive and if you buy new, a whole plethora of expenditure to claim to offset the costs. Happy to chat at the next skypecast or e mail etc. Kind regards Chris Link to comment Share on other sites More sharing options...
Guest uksniper Posted March 18, 2007 Share Posted March 18, 2007 Nev N Angie have you looked at the Defence Housing Australia website in relation to investing in property. Follow this link is you haven't seen it. http://invest.dha.gov.au/dha/ Link to comment Share on other sites More sharing options...
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