From A Global Financial Crisis New Millionaires Emerge
Why I am writing about this today is because one, the statement is very true and it could be you!
But secondly, I wanted to point out to fairly new investors and to the more experienced investors too, just how important it is that you use the right buying entity when going to contract.
Put simply, one reason is the fact that if you go to contract under one entity and then change it (especially if the contract is signed off as ‘unconditional’) before settlement the law says that the first contract entity must pay stamp duty and then the second contract entity would have to pay stamp duty as well.
But what could be more important to you is if you were going to hold the property long term, would be the tax implications.
Australia has wonderful property tax laws which really advantage investors but only if the investor works them to their benefit.
For this reason it is important that before signing any contracts you have a good long chat with a experienced property investment accountant who will advise you as to the best way to go about purchasing. You could expect to be asked questions about:
· your income and your partner’s income
· what name did you think you wanted to put the property in
· are you buying it in your superannuation
· how long will you keep it
· are you going to spend more money on it (renovate)
· are you going to rent it or sell it
Property tax laws are always changing and evolving and really the best you can do is work with the taxes that are in place now and keep abreast of any changes as they occur. That is why you want to be using an accountant that is experienced in ‘property investment accounting’.
Don’t delay as prices are starting to rise around the country and the new millionaires will be the ones who get in early and keep buying as their property equities increase.
Filed Under: Property Investment
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