NSW Laws Just Announced - Airbnb killer in Sydney

Discussion in 'Airbnb & Short Term Letting' started by Lacrim, 5th Jun, 2018.

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  1. SuzyG

    SuzyG Well-Known Member

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    Have there been any updates on NSW airbnb restrictions?

    My initial thoughts are there could be potential to get around the 180 days ruling (if passed) by setting up multiple entities that lease the property for 6 months at a time then 'sublet' on Airbnb for that 6 months, then assign the lease to the other entity for second half of the year. (And so on, on repeat). A bit of stuffing around, but if the returns are there it could be worthwhile.

    I've seen some interesting strategies posed on other threads around Airbnb structures by @Terry_w - you might be best placed to comment on the potential legality of a structure like this.

    You can't do much if the strata rules say no Airbnb, I imagine in that case you are buggered!
     
  2. Simon Hampel

    Simon Hampel Founder Staff Member

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    From what I understand from the NSW Parliament website, sitting was adjourned on June 20 and will resume on August 14.

    The "Fair Trading Amendment (Short-term Rental Accommodation) Bill 2018" is on the program, so we may hear more about this in a couple of weeks.
     
  3. SuzyG

    SuzyG Well-Known Member

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    Thanks Simon!
     
  4. Sick_of_scams

    Sick_of_scams Well-Known Member

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    Air BnB and other platforms people use to rent out space in their home is something I have read up on and now aware of the Capital Gains Tax implications for those considering casually renting out a spare room etc whilst living in the property themselves. Correct me if I am wrong but I am fairly certain that the portion of the property rented will be subjected to CGT due to the Capital Gains Event created whilst is was used as your primary residence. It is irreversible it seems.
    So any income you may have made for renting room will have to well and truly exceed the massive CGT pro-rata % that could wipe out all profits and more when it comes time to sell. It was published in a few newspapers a while ago but other than that no much talked about it.
    Now that is the true Air BnB killer and other platforms - for most who just wanted to make some spare cash to pay bills etc for a short time realise it is just not worth it in Australia.
     
  5. Paul@PAS

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

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    The amount of data from Airbnb and other shared platforms is scary and something the new Bill addresses. The Govt wants access to the data to avoid the sharing economy site being blacklisted. Airbnb said they would comply if thats what the laws say. Efforts to avoid the rules may be detected when the data is accessed by Fair Trading.. Subletting doesnt change a "short terms accomodation arrangement"...It just changes the parties responsible. Its the final letting that can create the offence. So if A rents to B and B sublets to C and C then lists it on Airbnb its C who gets the penalty not A or B.

    Definition :
    short-term rental accommodation arrangement means a commercial arrangement for giving a person the right to occupy residential premises for a period of not more than 3 months at any one time

    The use of a sharing economy website creates the offending commercial arrangement. I believe if you posted a card on a street corner it may bypass the concern BUT I would argue you wont get a lot of visibility.
     
  6. Pentanol

    Pentanol Well-Known Member

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