I am in serious trouble over Land and Absentee tax in QLD

Discussion in 'Introductions' started by Sick_of_scams, 23rd Apr, 2018.

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  1. monk

    monk Well-Known Member

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    Was wondering if you've followed this idea up? Check out the threads on this forum under 'Other Asset Classes' & look for threads on LICs,ETFs & Peter Thornhill.Could be a game changer for you.
     
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  2. Terry_w

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

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    A company could be set up cheaply, but the big cost would be stamp duty - and CGT potentially.

    You could potentially minimise CGT by sale of 50% to a company now and 50% next year.
     
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  3. Sick_of_scams

    Sick_of_scams Well-Known Member

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    I will definitely look at this. Thanks.
     
  4. Anthony Brew

    Anthony Brew Well-Known Member

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    Far better options for this person would be an all-world ETF.
    Less tax, better diversification, less currency risk, less concentration risk.
     
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  5. monk

    monk Well-Known Member

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    Maybe,but he's after a steady income stream & Oz based lic/etfs would provide a higher dividend.
     
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  6. Whitecat

    Whitecat Well-Known Member

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    monk, Mike A and Terry_w like this.
  7. Sick_of_scams

    Sick_of_scams Well-Known Member

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    THIS IS ABSOLUTELY RIDICULOUS - LOOK AT HOW MUCH THE LAND TAX & ABSENTEE SURCHARGE BILLS INCREASE YEAR ON YEAR:

    The last Land Tax & Absentee Surcharge charged to me for last financial year was $4863.00.

    Looking at the current Land Valuation up-trend set by the 'Department of Natural Resources & Mines) for the Brisbane suburb property I own, plus the current increase in general, I predict a year-on-year land value increase of $60,000. I believe this is realistic based on the trends.

    By the time it is 2025 my Land Tax & Absentee Surcharge liability would have increased to a WHOPPING annual bill of $16,170.00. That is in just 7 years (Look below)

    My rental income I rely on to live off as a self funded medically retired Australian citizen is totally and utterly obliterated. My take home net income after all the usual management fees, ongoing repairs, maintenance, income tax, council, water and sewerage rates, GST, insurance is many thousands less.

    How can ANYBODY as an absentee retiree hold onto a property like this? It is utterly IMPOSSIBLE. Already the chunk of the most recent Land Tax & Absentee Surcharge has screwed my living ability and I need to resort to the remaining savings I have. All my Super and insurance payment went into that property.

    Now I am looking at being forced to sell - taking into consideration the set up costs to buy - property strategist & buyer's agent fees, renovations needed pre-rental, legal, stamp duty and other fees, plus Capital Gains Tax - I have worked out I am set to lose $100,000 from this investment if I were to sell now. I believe I was ripped off with the price I paid for the property. Way overpriced for its condition. But I was sucked in by slick sales.

    But I am in a Catch 22 as holding it will force me into further financial difficulties and will become impossible. Where do I come up with that sort of money? I cannot get a loan. I have no job. Get a loan to pay for the TAXES anyway. I doubt that.

    This situation is driving me into absolute desperation. My retirement offshore plans to live a budget lifestyle totally obliterated. I sought Queensland pre-budget as a wise investment choice, recommended by the 'professionals' who reviewed my circumstances.

    Now everything is compounding into a perfect storm of sheer hell for me. I am on the absolute edge. This investment in Brisbane was the absolute worst investment decision I have made in my life and has effectively ruined my life. It is game over for me.

    Jackie Trad has just ruined me. Thanks QLD Labor for your Communist punitive restrictive laws. Do all Queenslanders realise how disadvantaged you all are legally compared to EVERY other state in Australia?

    All Queenslanders are prisoners to the State for 6 months every year or you face the same punishment. It is like a death sentence - a slow death through financial ruin and stress.

    Heartless, thoughtless legislation covered by their rhetoric that it ensures absentees make a 'fair contribution' - this is by no means fair. As a non-Absentee in QLD, I still would not be paying anywhere near the taxes I pay as an Absentee. Labor's argument to justify this is absolute and total BS.

    Anyone who falls for their rhetoric needs their heads examined.
    Queenslanders you are being totally screwed and many don't even realise it until their life circumstances change.

    EXCEL table Land tax & Absenteee Surcharge predictor.jpg
     

    Attached Files:

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  8. luckyone

    luckyone Well-Known Member

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    Geez, if the land is worth $510,000 the property must be worth a lot of $$$$. Surely you can sell it and reinvest elsewhere? Yes it'll cost you money in terms of selling fees and potentially cgt, but maybe it'll at least let you sleep at night. Investing into a fund like Vanguard sounds like a sensible idea for you. They've had consistently high returns. You could always do that and buy another lower cost investment property. that way you've still got a foot in the property market. You could even buy in qld again, you just need to ensure the land value is well below the $350,000 threshold.
     
  9. thatbum

    thatbum Well-Known Member

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    Hang on, you're complaining you got sold a dud investment that was overpriced - but apparently you're forecasting that its going to increase by $60k per year in land value? So more than 10% pa?

    Where can I sign up?
     
  10. Sick_of_scams

    Sick_of_scams Well-Known Member

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    I get your point. Fair enough. Had a lot of undisclosed work needed not revealed by building inspection report or marketers. And is an ongoing high maintenance property that needs a few hundred thousand to make it match what I was told it would be worth. Gross Capital gains at 10% but CGT will take care of that. Plus I cannot hold onto it as I rely off an income stream - hence forced sale option. No salary to keep up with payments of tax.
    Would need to hold for several years to break even but cannot afford to without selling. Catch 22. Others with better cash holdings/wealth may not have the same problem.
     
  11. Sick_of_scams

    Sick_of_scams Well-Known Member

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    Property not worth much more than the $510,000 value because it needs a lot of work. I can sell of course and reinvest - more than likely I am going to be forced to do that soon as rental income is being wiped out by the taxes. This property has all my Superannuation money in it and includes a lot of my compo payment for medical discharge. Thanks for the advice. Vanguard? I will check them out too. And threshold low - below $350k, but may be better off in NSW. Can always commute to see my poor old mum in QLD that way too and not cop the stupid taxes in QLD. Just wanted a stress free retirement LOL and turned into a ******* nightmare buying in QLD. Cheers again for the constructive comments.
     
  12. Anthony Brew

    Anthony Brew Well-Known Member

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    Nobody had ever had "consistently high returns" in the stock market, Vanguard included. The stock market is by it's very nature highly volatile. That is why the return is higher than other lower volatility investments. Neither Vanguard nor any other fund had a consistently high return when you include 2008, 2001, 1987, and dozens of other times.
    Not saying a well diversified portfolio is bad, and it may be this persons best option, but saying a fund in equities has had "consistently high returns" is a dangerous thing to say.

    Also the buying and selling costs in Australia are absurd. You start your investment with an almost 10% loss on day 1. Non residents also do not get the CGT discount for capital gains, nor the tax free threshold for rental income. Buying Australia property again in this persons situation doesn't make sense.
     
  13. Trainee

    Trainee Well-Known Member

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    A policy isnt a bad one just because it affects a small number of people. Some people are not in a position to own property. If even a 70% increase doesnt help you, property wont work for you.

    You want income and predictable and low expenses. Taxes are punitive for tax non residents, but thats just how it is. With just a couple hundred k for an easy retirement overseas sounds like too much wishful thinking. Like some investors relying on neverending credit.
     
    Last edited: 13th Aug, 2018
  14. geoffw

    geoffw Moderator Staff Member

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