Ownership for Tax Purposes

Discussion in 'Accounting & Tax' started by d01, 18th Oct, 2020.

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  1. d01

    d01 Member

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    Hi guys,

    we bought a property as a couple (PPOR), so both names are on the deed and on the loan. I am wondering, for tax purposes, is the split automatically 50/50 OR is there a way to split the ownership in different proportions? Since we already have the loan is it something I should have done earlier OR is it something that would happen at the first Tax Return once the property becomes an IP?

    thanks

    tomas
     
  2. Terry_w

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

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    Generally it is split according to legal ownership.
    The exception is if there is a trust relationship.

    This is why legal advice is best sought before signing contracts.
    Any change now could be done with minimal CGT if purchase was recent, but it would trigger duty.
     
  3. Paul@PAS

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

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    The % split for jointly owned property or tenants in common is equal shares UNLESS the transfer and ownership was registered with title in some ofther % as tennat in common (eg 90% / 10%). There is no scope for variable alteration of the ownership % OTHER than in rare instances of a property partnership which doesnt included spouses. A property partnership would likely need a agreement in writing that supports the % initially used and then it cannot change. Usually sound legal advice would recommend tenat in common in specified % rather than a partnership agreement.