Tax Tip 7: keep All Receipts forever

I’ve kept everything IP related. Files of paper, by property, by financial year (old school). How long after a sale would be safe to dump?

 

They must follow the law.

 

Generally for 5 years after the CGT event. But if you have the spouse keep them a bit longer I think.

Also if you have a loss you need to need those records for 5 years after you utilise the loss

 

I also think I will keep the spouse for a bit longer!!

 

That should have been 'space' not 'spouse'! Bloody apple autocorrect!

 

Not sure I have the space for the spouse

 

another reason to keep is in case you become a non-resident for tax purposes and later sell. The cost base expenses could reduce CGT

 

Its also reason why I suggest EVERY property should have a CGT record for every ownership cost from day 1. If pro-rata CGT applies later you could lack 20 years of tax data to legally avoid paying a single cent of tax. Many falsely believe their property is already exempt. There are ways it can change.

example Fredand Mary own a home and have since 1998. In 2012 Fred starts a sole trader business as a electrician at home. 10% of the home is his office / warehouse. Later he and Mary split and he retains ownership. He meets Suzi who has a LOT of money and moves in with Suzi to her Bondi beach house. He lets his son live in the old house rent free. Later Suzi dies and he now owns Bondi 100%. Fred decides to sell his old house and knows tax will be involved but now realises he lacks the records to minimise and calculate the least tax position. He cant use the absence rule, doesnt know his ownership costs and even dates are a little fuzzy.