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Land Tax query

Discussion in 'Accounting & Tax' started by pokeutopia, 26th Nov, 2015.

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  1. pokeutopia

    pokeutopia Member

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    Hi,

    Just wondering, for those who are over the threshold for their land tax in NSW, and would like to add more houses (i.e. more lands) in NSW, what avenues are available to reduce your land tax? Trust won't really work as their is no tax free threshold and I don't think company structure would be good as you would lose the negative gearing and capital gain tax. Another option would be through a SMSF perhaps, but what is the pros and cons of that? What about cost? Otherwise, buy it under spouse or joint, but I don't have a partner at the moment.

    Regards
    David
     
  2. D.T.

    D.T. Adelaide Property Manager Business Member

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    SMSF
    Partners name
    Other states
     
  3. Scott No Mates

    Scott No Mates Well-Known Member

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    Just live with it, but commercial where lv is lower & net yields are better.
     
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  4. Paul@PFI

    Paul@PFI Tax Accounting + SMSF Business Member

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    The most common strategy that also reflects the market cycles is to diversify holdings across other states. Of course the market cycles that affect QLD are very different from say Vic / NSW. But its suffice to say buyers are shying off NSW as overprices or peaked and looking at Qld which has emerged from being flat / down. Of course not all areas !! The resource commodity issues in Qld have harmed prices in some port and mining reliant communities.
     
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  5. Terry_w

    Terry_w Solicitor, Finance Broker, CTA Business Member

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    There are limited options. A company would get a separate land tax threshold. But there are anti avoidance provisions to stop you getting another threshold by setting up another company. But you could stretch this a bit with other family members being involved.

    The easiest solution is to buy in other states. Next is to find a spouse - I would go the other states route first!
     
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  6. pokeutopia

    pokeutopia Member

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    What are the cost involved with setting up a company to use to purchase property? You would potentially lose the 50% capital gain tax under a company structure I presume?

    Haha other state looks good or eHarmony would be my next bet.
     
  7. Terry_w

    Terry_w Solicitor, Finance Broker, CTA Business Member

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    I charge $1100 to set up a company - with legal advice.
    50% CGT discount would be lost, but there may be other benefits
    Legal Tip 55: A Company Owning Property