Curious to know how much deductions for agent fee

Discussion in 'Accounting & Tax' started by Drekko, 5th Mar, 2018.

Join Australia's most dynamic and respected property investment community
Tags:
  1. Drekko

    Drekko Well-Known Member

    Joined:
    31st Jan, 2018
    Posts:
    221
    Location:
    Melbourne
    Hi guys

    This is probably a question for my accountant at tax time but im very curious to know
    Say I am in the 80k to 90 k tax bracket and I rent out my house using an agent that asks for 5.5% commision

    When it comes to tax time say if i charge $400 per week for property 1 - the 5.5% agent fee
    and property 2 I am charging $320 per week minus the 5.5% commision

    how much from that do you get back from the tax man? Is it possible to work out?
     
  2. Trainee

    Trainee Well-Known Member

    Joined:
    24th May, 2017
    Posts:
    10,256
    Location:
    Australia
    Too many things missing. And you dont know how tax works. There is no 80-90k bracket. Need information on all the other expenses (interest, etc) and how much tax is deducted from your pay.
     
    Terry_w likes this.
  3. Trainee

    Trainee Well-Known Member

    Joined:
    24th May, 2017
    Posts:
    10,256
    Location:
    Australia
    This question doesnt actually make sense.
     
  4. Drekko

    Drekko Well-Known Member

    Joined:
    31st Jan, 2018
    Posts:
    221
    Location:
    Melbourne
    ah ok so not really possible to work out or get a rough figure
     
  5. Trainee

    Trainee Well-Known Member

    Joined:
    24th May, 2017
    Posts:
    10,256
    Location:
    Australia
    Not with whats in your post no. What are you even asking?
     
  6. Drekko

    Drekko Well-Known Member

    Joined:
    31st Jan, 2018
    Posts:
    221
    Location:
    Melbourne
    I am asking how much I will be getting back from agent fee's when deducting it from tax when you do your tax return. I will just need to wait untill tax time. Thought it might of been easy to see yourself
     
  7. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

    Joined:
    18th Jun, 2015
    Posts:
    41,667
    Location:
    Australia wide
    32% roughly
     
  8. Mike A

    Mike A Well-Known Member

    Joined:
    24th Jun, 2015
    Posts:
    2,656
    Location:
    UNIVERSE
    Impossible to answer.

    1. Did you do a PAYG withholding variation.
    2. Did your employer take out enough tax at the right rate.
    3. Do you have any other income.
    4. Do you have any other deductions.
    5. Do you have a HECS debt

    Etc etc
     
  9. Paul@PAS

    Paul@PAS Tax, Accounting + SMSF + All things Property Tax Business Plus Member

    Joined:
    18th Jun, 2015
    Posts:
    23,319
    Location:
    Sydney
    Your marginal tax rate determines the refund vs what the outgoing is

    Surely before you invested you knew the issue. Im stunned sometimes by such a question after you invest $500k
     
    Ross Forrester likes this.
  10. Mike A

    Mike A Well-Known Member

    Joined:
    24th Jun, 2015
    Posts:
    2,656
    Location:
    UNIVERSE
    Again these open ended questions with little facts is why accountants end up run off their feet.

    Terry says 32% roughly and then you find out the person was a sole trader first year who didnt enter the PAYG instalment system and so they had a significant tax liability year one.

    There tax rate overall may well be 32% but they then ask why they dont get back a refund as i read on a forum you will.
     
    Paul@PAS likes this.
  11. Drekko

    Drekko Well-Known Member

    Joined:
    31st Jan, 2018
    Posts:
    221
    Location:
    Melbourne
    IF you wanted more info all you had to do is ask. Ive been earning between 80k-90k for 3 years previous to that I was on 60k for over 8 years

    If that helps if not, its fine I was just asking out of curiousity
     
  12. Trainee

    Trainee Well-Known Member

    Joined:
    24th May, 2017
    Posts:
    10,256
    Location:
    Australia
    The answer wont mean anything. No value to decision making. Ask your accountant and if hes smart hell charge you by the hour to explain it. After the first hour you wont want to pay more.
     
    Ed Barton likes this.
  13. Mike A

    Mike A Well-Known Member

    Joined:
    24th Jun, 2015
    Posts:
    2,656
    Location:
    UNIVERSE
    @Pat1983 not being critical of you or anyone the tax system has just made what should be a simple question a hard one.

    Just read a financial planner was successfully sued for 3m for providing tax advice.
     
  14. Drekko

    Drekko Well-Known Member

    Joined:
    31st Jan, 2018
    Posts:
    221
    Location:
    Melbourne
    Ouch
     
  15. Paul@PAS

    Paul@PAS Tax, Accounting + SMSF + All things Property Tax Business Plus Member

    Joined:
    18th Jun, 2015
    Posts:
    23,319
    Location:
    Sydney
    You expect a tax adviser like mike to give you...free... advice. Lets start wih a response of $0 refund. Now get real facts. Curious myself
     
  16. Drekko

    Drekko Well-Known Member

    Joined:
    31st Jan, 2018
    Posts:
    221
    Location:
    Melbourne
    Incorrect, did not expect anything. I only asked if possible to work out yourself. The figures were only examples
     
  17. Trainee

    Trainee Well-Known Member

    Joined:
    24th May, 2017
    Posts:
    10,256
    Location:
    Australia
    Possible to work out the tax benefit of a deductible expense to you? Yes.

    If you didnt understand that sentence? No.
     
  18. qak

    qak Well-Known Member

    Joined:
    1st Jun, 2017
    Posts:
    1,671
    Location:
    Sydney
    Yes you could work it out yourself if you had the full details of income & expenditure ... and any other relevant information. Check out ato.gov.au
     
  19. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

    Joined:
    18th Jun, 2015
    Posts:
    41,667
    Location:
    Australia wide
    It depends on what you are asking exactly.
    For any expense it would be the margin tax rate that you save, but all expenses added up could mean you drop a tax rung so it may be less than the marginal tax rate.

    But if you are asking how much tax refund you will get that will vary widely depending on the factors Mike listed.
     
  20. Paul@PAS

    Paul@PAS Tax, Accounting + SMSF + All things Property Tax Business Plus Member

    Joined:
    18th Jun, 2015
    Posts:
    23,319
    Location:
    Sydney
    I have 20+ years tax experience with tax and property. And I learn something new every week.
    I think many taxpayers think its as simple as reading something on the ATO website means they are correct.

    Its like DIY surgery. Not recommended for all the things you dont know.
     
    Terry_w likes this.