Whose name to buy investment property under?

Hi Tax experts,

I need some advice re: ownership of investment property as both me and my wife are in different tax brackets. As the portfolio grows the tax seems to have increased in land tax etc... who can suggest the best was to legally reduce tax for own situation.

 

Your post is very confusing. Depends on incomes, value, future plans, etc

 

Why are you only considering tax?

 

I fall under higher tax bracket than my wife and I was hoping to purchase the next property under joint name. But during tax time I will only be able claim deductions on half the expenses due to ownership..also I am paying land tax as the taxable value of the under my name is over the threshold now...hence my question

 

So why joint names?

 

To utilise my wife's land tax threshold..as we do intend to grow the portfolio

 

Get some legal advice

 

Hi

The land tax advice will depend on which state you are buying in. Can I ask where you’re buying?

 

So far everything has been in Vic so I assume I am working on a threshold of 500K

 

To answer this would require you sitting down with an accountant who is a strategist, taking into account your short, medium and long-term goals.

 

Accountants couldn't advise on the land tax aspects. A lawyer would more appropriate as they could advise on land tax and other related legal advice.

 

The days of accountants giving advice on everything are coming to an end. Fortunately a few are forming teams of independant people and firms to assist where they legally cannot.

Australia is going down the litigation route very quickly and any accountant or financial planner or mortgage broker that wants to destroy their financial lives for advising in areas they cannot is a fool. And to be honest if they cant protect their own affairs properly you have to wonder if they can help others effectively. Ill give you some people who had their lives destroyed from giving advice on areas they were not specialists in. Give them a call and they will praise the virtues of outsourcing to the right people.

I just had a discussion with an accountant on Linkedin who didnt know you couldnt advise a client to electronically sign a trust deed. Trust deeds CANNOT be electronically signed. You can send them electronically but they MUST be printed and wet signed. If you did the deed was invalid and the accountant open to be sued. Potentially without PI coverage.

Accountants cannot provide legal advice on structures only the tax aspects which is a tiny part of the advice. Get it wrong and the accountant isnt even covered by their PI insurance. Accountants cannot provide holistic advice on estate planning. This very issue was just raised by a WA estate planning law firm.

First ask your accountant do they give advice on the legal and estate planning aspects of structuring ? If they answer yes ask who is part of their team who is a lawyer.

Many accountants are surprised to learn that TASA only provides authority for a registered tax agent to provide advice on Commonwealth tax law but not State or Territory laws such as stamp duty, land tax and payroll tax. Such advice therefore falls under legal advice which should be provided by a lawyer in the jurisdiction. Accountant gets it wrong. Can be sued. PI insurance probably doesnt cover them. Breach of state laws regarding providing unlicensed legal advice. Competitor wants you to experience a world of pain. They put in a complaint to the relevant governing body. Accountant may even lose their entire practice.

Im now having @Terry_w provide the legal advice and structuring aspects to my clients. I believe @Paul@PFI is doing the same.

 

Yesterday I was told by BGL I can form a company using CAS software. I was horrified. I will never self-form a trust or company. Its legal work. I wonder how many may fall for this trap. An application to ASIC to register a company seems to be the incorporation of a company - a legal service. This is different to ordering a company from a legal practice.

I refer to Terry Waugh and Darryl Richards from Certus for same reasons. I'm confident they both know tax and property issues etc backwards. Had a great talk with Darryl about some of these issues just yesterday. We discussed basics of a loan agreement. Nothing actually basic to it - Complex sometimes. I have seen many accountants draft minutes and even a loan agreement. Its a great way to get struck off.

Important to remember too that accountants typically cant advise on financial products, credit/lending, legal issues, SMSF rollovers, contributions and pensions and many other matters.