AMA - Round Two - Tax and Tax Return Questions - Ask Me Anything - GO!

Associatednicolemcmilllon @ Titanium Accountants & Advisors on 31/05/2017 - 09:15
Last edited 05/07/2017 - 10:20 by 2 other users

Edit % June 2017

I have now closed this thread.

I will think about posting a third round on the last week of June depending on how many people want me to do it.

I will be ready to prepare everyone's 2017 returns in July. I look forward to hearing from you.

For everyone else, thank you for participating and I hope you appreciated our answers.

Hi All,

I did a tax AMA a few weeks ago and got an overwhelming response (close to 700 replies).

I am going to do another one that will go from today 31 May to Sunday 4th June.

If you have any tax or tax related questions then ask below and I will do my best to get back to you as soon as possible.

Disclaimer: Any advice or answers given will be general in nature and you may need to speak to a tax adviser for more personalised advice.

P.S Please see my previous forum post as we tried to avoid duplicate questions.

I will reply to this thread with a link to the previous post.

Look forward to answering all your tax queries.

Lets do this!

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closed Comments

  • tajid on 02/06/2017 - 11:40

    If I work and study, which transport costs are deductible?

    Home - work - uni - home.

    I'd think the work-uni one.

    • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 02/06/2017 - 11:58

      Work to uni and uni to work. nothing to and from home.

      • tajid on 02/06/2017 - 12:03

        Thanks. Given I use public transport and opal card to pay, should I just make a diary of the travels and costs or the transaction history on opal site is sufficient?

        • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 02/06/2017 - 12:14

          Should be fine

      • techboy on 02/06/2017 - 12:58

        You can use these other trips to offset the $250 reduction.

  • Mohamed S on 02/06/2017 - 11:47

    Hi, If I earn less then 52K and my pregnant wife doesn't work, would I be eligible for the full tax return? Should I claim hospital expenses?

    • techboy on 02/06/2017 - 13:03

      No you can not claim any medical expenses anymore.
      Also, by full tax return do you mean get everything back? if so that I highly doubt it.
      You are doing an individual tax return NOT a household tax return (which we don't have in Australia).

  • uiriamu on 02/06/2017 - 11:47

    Hi Nicole!

    My partner and I bought our first home to live in it straight away (Victoria). We soon found after we bought from a building inspector it that it was dangerous to live in and had to have the stumps and subfloor replaced. This meant we lost the entire floor including kitchen, bathroom, roof and even plaster etc. Basically had to replace most of the house. Am I right to say we can't claim tax on any of these repairs? Its been a nightmare haha.

    Cheers

    • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 02/06/2017 - 11:58

      No you can't claim any of it.

      • uiriamu on 02/06/2017 - 22:44

        thanks Nicole =)

  • xdiep on 02/06/2017 - 11:49

    Is it unethical to squeeze an extra 2 cents at the petrol bowser, even though the filling had stopped at exactly $70?

    • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 04/06/2017 - 10:14

      Just do one cent and call it a day. 2 cents is getting greedy :)

  • JuryWheel on 02/06/2017 - 12:04

    RE:Education
    I am undertaking a uni degree that is being paid through HELP - the only fees i pay upfront are about $100 a semester. Is there anyway to actually claim the full uni fees that i am building up ($7-10k a year) on my tax? The study is tax deductible since i am upgrading my qualification for my current employment. Do i start claiming it once i actually start paying it back (once my wage is over the threshold) or do i claim it as i go?

    • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 02/06/2017 - 22:48

      Unfortunately HELP repayments will never be deductible. Sucks I know

  • cryptos on 02/06/2017 - 12:08

    Hi Nicole,

    Thanks for your time, I'm able to salary sacrifice a car for work purposes, however my question is is there a limit on the amount you can claim per year? Ie $35000 - $40000 per year on a 2 year basis

    Also do I have to use a novated lease setup or can I get my own loan and expenses?

    Thanks

  • blergmonkeys on 02/06/2017 - 12:19

    Quick question - I'm a doctor and my wife is a nurse. We often study from home and have set up a home office.

    We are thinking about getting solar power installed to help offset power costs when we work from home. Can I claim a solar install into my tax for this year?

    • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 02/06/2017 - 12:22
      +1

      No

      • blergmonkeys on 02/06/2017 - 13:00

        Thanks! Thought so, but figured I'd ask.

  • undercut on 02/06/2017 - 12:54

    Hi Nicole,

    I have a company and employ my wife. Is it more beneficial tax-wise to have her as an employee, or as a subcontractor?

    Thank you :)

    • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 02/06/2017 - 12:58

      have you first thought of personal services income etc?

      • undercut on 02/06/2017 - 13:09

        Haven't heard of it before, but I'll do some research

        • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 02/06/2017 - 13:12

          what kind of business does your company do?

        • undercut on 02/06/2017 - 13:13

          @nicolemcmilllon: I'm a chiro, my wife does the admin

        • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 02/06/2017 - 13:17

          @undercut:

          Do you have an accountant? Have they discussed with you that you may not be able to pay her for admin services?

        • undercut on 02/06/2017 - 13:34

          @nicolemcmilllon: Yes and no. Sounds like I need to have a chat with them!

        • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 04/06/2017 - 10:13

          @undercut:

          You should have had tis chat with them a while ago. Planning ahead is key for any business, especially in regards to tax minimisation.

          Contact me if and when you realise your accountant hasn't informed you :)

  • Strawberriez on 02/06/2017 - 13:17

    Hi, I own a place (with mortgage) that I currently live in. My parent are over 65 and they plan to retire soon. They own a property (mortgage free) that they think of transferring to me. Can you provide some advice on how we can reduce the tax on the transfer? Is it better if they sell or transfer to me? And what is your advice on renting either of the properties? Thanks.

    • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 02/06/2017 - 13:19

      Is it the property they live in or is it their investment property.

      IF it is their principal place of residence they won't pay tax on the sale.

  • dealsniper on 02/06/2017 - 13:44

    Is there a cap on work related self-education expenses?

    • techboy on 02/06/2017 - 14:05

      Not yet…

    • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 02/06/2017 - 16:34
      +1

      Theres no cap, just be prepared for an audit if you're asking if there is a cap lol

  • [Deactivated] on 02/06/2017 - 15:25

    Hi Mate,
    I bought a house in September 2017 (as my first one - considering I live with my brother and paying rent to him). The house was old and needed renovation before renting it out. From September till end of Feb 2017 I renovated it and the renovation cost (including fence and etc) 25K.
    From March it's rented out to a couple ( I still pay rent to my brother that I live). So I think I need to pay tax for the income I get from renting my house.
    I've heard I need to keep all receipts of renovation (and I did), but I think (5K (rent income) + 25K (renovation cost)) I dont have to pay tax for it? Am I correct? if yes, what happened to that -20K that reduced my whole income? does it change anything or it's simply discarded.

    Also, I work as IT consultant which I need to have my phone, laptop and all IT stuff for my work, can I use tablet I bought, including apple watch? I still use it to check my emails and notifications at work in meeting.

    Thank you very much

    • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 02/06/2017 - 16:36

      The renovations are not deductible, they are a capital asset. You can choose to write off 2.5% of the renovation cost each year.

      Do you have an accountant who prepares your return

      • techboy on 02/06/2017 - 18:11

        Sorry Nicole, Yes they are a capital asset, I somehow read that these were a repair……

    • techboy on 02/06/2017 - 16:40

      The renovation costs are not claimable as they are seen as a 'repair too soon' and would have been reflected in the purchase cost. They would however be added to the cost base when it is sold to minimise Capital Gains Tax.
      The $5,000 rental income is seen as income and yes you will need to pay tax on it. However you should try to offset it against any rental deductions that you can.

      Anything that you use for work needs to be proportioned between business (work) use and Personal use (home).
      Anything under $300 would be claimed at once x business use. Anything over $300 will need to be depreciated over the lifespan x business use.

      Deductions for depreciation are calculated at Cost x (number of days remaining in financial year / 365) x depreciation rate x business use.

      • virhlpool on 03/06/2017 - 16:49

        How to differentiate between repair and renovation for tax purpose? I guess repair is tax deductable while renovation adds to the base cost of property.

        • techboy on 03/06/2017 - 17:32

          a renovation would be a completely new item or an item replaced with another.
          a repair is just fixing something back to how it was.
          a renovation would be claimed at 2.5% per year as a capital works deduction.

        • virhlpool on 03/06/2017 - 17:35

          @techboy:

          a renovation would be claimed at 2.5% per year as a capital works deduction.

          Thanks, techboy. And how would repair be claimed?

        • techboy on 03/06/2017 - 17:42

          @virhlpool: A repair is claimed in full when it is paid, unless it is a repair done within the first 12 months. This is seen as an existing problem that the purchase price factored in. You would add that to your cost base when selling it.

        • virhlpool on 03/06/2017 - 18:04

          @techboy: One more question - if renovation is claimed at 2.5% a year for 40 years, then why is claimable amount generally much higher in initial years after purchase of a property (no matter new of old)?

        • techboy on 03/06/2017 - 18:20

          @virhlpool: It is not. It is claimed as a Prime Cost deduction so it is equal throughout the 40 years (except first/last years).

          there are two ways to claim assets, Diminishing Method (greater claim in first few years) and Prime Cost Method which is a straight line equal deduction. Capital Works Must be claimed using Prime Cost.

  • etrx on 02/06/2017 - 15:42

    Can I grab your email address for the questions that I have?

  • ultra64 on 02/06/2017 - 15:59

    I am an uber driver. For the bas return Can you advise if tolls are to be included as part of the income?

    Thanks

    • techboy on 02/06/2017 - 16:31

      Tolls would be an expense. You are paying them, not being paid to use them.
      Also as nicole asked if the passengers are paying these (included in the fare) then yes they are income.

    • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 02/06/2017 - 16:34

      do you charge the rider the toll?

      • ultra64 on 03/06/2017 - 10:34

        Thanks techboy and Nicole.
        Yes, uber built in the tolls to be charged to the riders. I am being reimbursed the tolls charged to my tag and passed on to the rider.

        • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 04/06/2017 - 10:11

          As the rider is paying you for the tolls, you include that amount as your income.

          As you are also then paying your own toll charges to your account, you claim that amount as expenses.

          Essentially, these amounts will net off to nil.

  • haha on 02/06/2017 - 16:12

    Hi,

    What is the maximum amount received before I have to charge GST for solo trader; maintenance work like cleaning etc?

    Cheers

    • techboy on 02/06/2017 - 16:33

      If you earn more than $75,000 you MUST be registered for GST and charge accordingly.
      If you earn under $75,000 you can choose to be registered (except uber/taxi drivers).

      I personally can't see any advantage in being registered if you don't have to be.

    • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 02/06/2017 - 16:33

      75,000

      • haha on 02/06/2017 - 19:56

        Could I charge my clients GST and not pay the GST if the business earns less than $75000 per year?

        Many thanks

        • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 02/06/2017 - 22:32
          +2

          Is this a serious question?

        • griffy on 04/06/2017 - 21:29

          So you're claiming to collect tax on behalf of the Government from your clients and then not pay it? Sounds like fraud buddy.

  • sii on 02/06/2017 - 16:41

    Didn't see this before I posted about my TAX deductions in the FORUMS.
    Could you please look in this link and let me know your thoughts.
    https://www.ozbargain.com.au/node/310596

    Many Thanks. Really appreciate doing this AMA.

    • techboy on 02/06/2017 - 17:05
      +1

      Question 1: No the expenses have nothing to do with your paid job.

      Question 2: (a) You should be claiming the tax free threshold for your only paying job. (b) All depends on what these expenses are and how they relate to your paying job. You can not claim anything that is related to your Part time PHD.

      • sii on 02/06/2017 - 17:16

        Oh! Thanks for your comment.
        quick question with 2(a): even though I got stipend from the uni for PHD I can still claim tax free threshold from my JOB…? Is the stipend technically not a salary for TAX purposes..?

        • techboy on 02/06/2017 - 17:21

          Be careful with the scholarship/stipend as not all are tax free use this :

          https://www.ato.gov.au/Calculators-and-tools/Host/?anchor=IM…

          If it is tax free the it doesn't get added to your other paying job to work out tax payable.
          But it will be used to calculate other things..which probably don't apply to you…??

        • sii on 02/06/2017 - 17:28

          @techboy: Great stuff! Thanks for your help. I used the link and it said not TAXABLE and don't need it to report as an assessable income. Which means I can save money (in terms TAX) and finish my Ph.D sooner :). another good reason to use ozbargain :).

  • blessupnico on 02/06/2017 - 16:56

    Hey there,

    so sorry if this has been asked before but I'm a uni student and was wondering if I can claim back the purchase of a laptop as well as textbooks?

    Many thanks

    • techboy on 02/06/2017 - 16:59
      +1

      You can't claim anything as you haven't paid any tax.
      Claiming reductions reduces your taxable income so you pay less tax.
      Also, you can only claim them if they are required for work purposes or study purposes (if the course is directly related to the current job that you have).

      • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 02/06/2017 - 17:06
        +4

        Techboy, thanks for taking these ones, they're asked about 20 times and another 50 times in my PMs

        • techboy on 02/06/2017 - 17:09
          +2

          No worries, don't mean to stand on your toes. Only work during Tax season and I enjoy reading theses questions, gets my brain working again..:)

          I normally try to either answer any ones that you haven't seen/answered or have been asked over and over…or to clarify something.

  • bickas on 02/06/2017 - 17:25

    Heya, thanks for taking the time to answer some questions.

    This is a long one with lots of questions, so let me know if it's too much and I'm just better off speaking directly to an accountant and paying for some consultation.

    So….my wife and I are going to be moving overseas to England in July and had a few questions about tax requirements.

    Personal stuff background:
    1. I have a British Passport
    2. Wife will be on a working holiday visa (Australian Passport)
    3. We both have help/hecs debt so will advise the ATO and keep paying that off as required.
    4. I am getting some final payments in July from work, so in the new financial year, and we still have some assets: shares in my name, bank account with interest earned in her name.
    5. In addition my current work wants to keep me on as a contractor to work in the new financial year, but wants me to set up a company in order to contract with them.
    6. When we get to England, both my wife and I will be working and earning a salary there + my sub-contracted work for the company in Australia (though we will be residing in England).

    Personal stuff questions:
    1. I imagine we will still have to lodge tax returns with the ATO at the end of next financial year. Will there be any additional obligations if our primary residence won't be in Australia anymore (given I'm a resident and my wife is on a working/holiday VISA)?
    2. Will I/we also have to claim the amount that we earn in England as part of my Australian income? (possibly again after I have have been taxed in England, even if I don't hold that money in Australia)

    Company stuff questions:
    1. Based on the work my current company want to subcontract out to me, I will need to set up a company. Is there any benefit to setting this up with both my wife and I as shareholders? (rather than just myself as the sole shareholder and director)
    2. I imagine it would be worthwhile making my wife and I employees of the company. Can I effectively 'pay' all the business income out to myself and my wife as 'salary' so as to reduce the business profit and pay the majority as split between my wife and I as personal income tax?
    3. If I pay out a salary to myself and my wife, I assume I will also have to pay superannuation - is this correct?
    4. Is it better to set up a company in the new financial year so that I only have to lodge a company tax return in July 2018? Or can I choose my own financial year for the company?

    Thanks!

  • Progart on 02/06/2017 - 18:12

    Hello, i work as a freelance graphic designer. In my current job i was asked to use ABN and this is the first time I'm using my ABN. How is this going to affect my tax return? What do i need to do at tax return time, just bring all the invoices and my accountant will count how much tax that i should pay? And also, as a comparison would it be more beneficial to me to use ABN or to use TFN as what i normally do? Thank you so much!

    • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 03/06/2017 - 07:40

      Keep it as an ABN, take everything to your accountant at the end of the year.

      If you need an accountant, PM me :)

  • Richardc on 02/06/2017 - 18:53

    @nicolemcmilllon
    Hi
    I bought a house and plan to knock down rebuild, so it's vacant for 1.5 yrs, then because I didn't have enough money to rebuild, so I renovated it and start living in there, after 8 months, I sold it. Would I be able to apply the "Treating land as your main residence" for fully CGT exemption by using the 4 yrs rule? https://www.ato.gov.au/General/Capital-gains-tax/In-detail/R…

    Thanks

    • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 03/06/2017 - 07:39

      You should be able to. Best to sit down with your accountant and go through your circumstances in detail.

  • 1mmy1mmy on 02/06/2017 - 19:31

    Hey thank you for posting again! Today I was actually thinking/cursing myself for not asking this question on your last post!

    I was working for a NFP and I was collecting meals and entertainment receipts, thinking that I could lodge them when I did my tax return. But I'm now under the pression that if I didn't lodge them with the salary sacrifice company (advantage) when I was an employee then I missed the boat. Do you have any advice about this?

    Thanks again

    • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 03/06/2017 - 07:38

      You can't claim meals and entertainment expenses as personal deductions in your tax return.

  • Lvl1pro on 02/06/2017 - 20:54

    Hi ,

    I am thinking of changing jobs soon and I will be moving up a tax bracket if I do get the job. It is unlikely that i will get the job this financial year but It will be a jump from 65k to 100k. Is there any way to (legally)take the 10k from next year and place it into this year's tax return so I dont pay as much tax on it? Or is this something that cannot be done?
    Thank you!

    • chumlee on 02/06/2017 - 21:05

      How would they be able to do it though?

      • Lvl1pro on 02/06/2017 - 22:20

        I am not too sure just thought I would ask to see if it is possible. I am also wanting to start my own business on the weekends so it may be possible to do something like this if I had an ABN?

    • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 03/06/2017 - 07:37
      +2

      You can't do it. Just be happy you're getting a 35k pay rise :)

      • Lvl1pro on 03/06/2017 - 11:27

        Okay thank you haha :).

        • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 04/06/2017 - 10:09

          You're welcome :)

  • Sweetsugar on 02/06/2017 - 21:18

    I know i cant claim travel expenses but how about parking charge. I pay 3000 per year. Can i tax deduct that. Thank you

    • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 02/06/2017 - 22:31

      are you an employee? if so, you cant

  • Pagu on 02/06/2017 - 21:22

    Hi Nicole,
    My wife and myself are both GP's and operate through an ABN, both of us work for the same company and have independent contracts with them. Is there any way in which we can get a joint contract and classify my income as PSB rather than a PSI for obvious reasons?
    She works over 20% of the total time.

    Other than super contributions and investment property, is there any other way of saving taxes?
    Can we employ a friend's wife who is not working as a secretary for the company?

    Thanks.
    pagu

    • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 03/06/2017 - 07:36

      Which tests do you hope to pass to classify it as a PSB?

  • bigfec on 02/06/2017 - 22:49

    I am looking to renegotiate my salary package. Currently I am on approx. $125k. Am I better off asking for a car or an increase in salary

    • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 03/06/2017 - 07:35
      +1

      Which colour is nicer, blue or red

  • khelddar on 02/06/2017 - 23:08

    Long time AMA thread lerker, first time caller.

    I bought a house that was built circa 1960's towards the end of march this year and have been renovating it since, will end up taking 3 months to reno. I know that i wont be able to claim depreciation because of the age of the house but can i claim a rental loss or other deduction?

    Other info:
    My father is renovating and i intend to pay him, has kept receipts, i live in vic, property is in qld, had to fly interstate before settlement to view it

    • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 03/06/2017 - 07:36

      The renovations are capital and you can add them to the cost base of the property.

      If you are renting the property you can write of the renovation costs over 40 years (2.5% per year).

      Speak to your accountant when doing your return to see if this is something you want to do.

  • filmw on 03/06/2017 - 01:03

    My friend lives in a two storey house and rented out ground floor to a tenant.
    Can she still claim PPOR exemption when selling in the future? or is it only 50% claimable?

    • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 03/06/2017 - 07:31

      A bit more complicated than that. Needs to see an accountant when it comes time to selling.

      • filmw on 03/06/2017 - 18:17

        So you mean it's still possible to have PPOR exemption in this case?
        Can you tell me more about what the complications are and any thing else she needs to be mindful of before the sale?

  • maelstrm on 03/06/2017 - 01:47

    Hi Nicole,

    Thank you for providing advice, I'll keep your business in mind if I decide I need tax advice in future!

    A few questions that I'm probably overthinking, would appreciate any light you can shed on them:

    1) If you intend to hold shares long term, but they are (hopefully temporarily) down in price, is there a benefit to selling shares at a loss (thereby claiming the capital loss), immediately re-buying them at ~ the same price you sold them for, holding for 12+ months and then selling with the capital gain and 50% discount? eg would the loss be recorded at 100% and the gain at 50%, so you could effectively reduce the tax on the gain?

    2) If a (married) couple own shares via a joint account does the distribution of dividends have to be 50/50
    - a) for tax purposes
    - b) for practical distribution (eg would it need to be considered a "gift" if not?)

    3) If a couple own shares via a joint account and one partner buys a parcel of shares via a transfer of money from their individual account, are there any tax implications (gift/dividend/etc)? Or is it simply considered an internal reallocation within the couple?

    • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 03/06/2017 - 07:34

      1. It is illegal to wash your shares (which is to sell them at a loss and rebuy them immediately). google "dividend washing"

      2. a) yes,
        b) it doesn't matter who gets the dividend

      3. are you talking about buying your partner's shares. he shares are jointly purchased, you will have to get the name of owner of the shares to be changed to one owner

  • swilso on 03/06/2017 - 05:36

    My brother in law who works underground in mines said he is able to claim wrist watches as a tax deduction. From previous info, me as a HPE teacher can only claim a watch that is only a stop watch ? However I do have a GPS watch that I use to watch what active calories I burn through the day due to work (to remind myself to eat and drink) , I have used it to log cross country segments and interval/speed training with kids, the beep test is on my watch with the assistance of a hooter, I'm regularly not in the classroom so I receive messages or calls from the school office through it (paired with my phone) and I use it on hikes and tracking trails for other school activities e.g. Training for our school team Kokoda challenge students.

    Would I be able to claim a portion of the cost of my watch based on work use ?

    • Associatednicolemcmilllon @ Titanium Accountants & Advisors on 03/06/2017 - 07:34

      Its fine just claim the percentage of use that is work related. Its not too much of a big deal to worth stressing about.

  • Food on 03/06/2017 - 08:45

    PM'ed you. Thankyou

  • yjun355 on 03/06/2017 - 08:57

    Directly thanks for your time. I had 2 questions:

    A. I own my apartment and live in it. If i rent out my second room.
    Then does my apartment become 50% investment property?

    Say i bought it for $100,000 and now its worth $200,000.
    So say in 5 years from now i sell it for $300,000. Then i have to pay capital gains tax from its value today i.e. 200,000.
    Then obviously it's only 50% portion? Then again unless rules haven't changed i get 50% discount for holding investment for more than 12 months?
    So effectively my capital gains is for 25,000?

    B. I work in company and get income and pay taxes.
    I start a pty ltd company with my friend and say we put in $1,000 each in there. That is like start up cost of that company. Say company in worse case doesn't do anything and is failure.

    Now,
    i. Can i claim $1,000 in any way is investment loss against my income?
    Ii. Any idea when that .pty ltd company has cashflow. How to structure so i can claim deduction against my salary.
    How do people typically structure or any advice to maximise tax benefit.

  • Jmack on 03/06/2017 - 10:04

    Hi thanks so much for doing this I have been a viewer of this site for years however have never signed up until now.

    I have a few questions.

    1) my wife and I are teachers and live in a rural community in western Queensland, we often drive a two hour trip each way to the shops and buy school supplies using a government issued credit card, for our school.
    We do buy some of our own things and we often do other things whilst there that are unrelated to work. are these trips claimable 100% or proportional or not at all ? Should I be keeping a journal of these with reasons for ATO.

    2) we bought a house in November of 2011 and lived in it until January of 2015, we have since put tenants into it and made it an investment. Do we have to sell it before November 2017 to avoid capital gains tax ? Or is this something we cannot avoid, and will have to pay cgt ?

    3) I'm also studying a masters degree in education (direct field of employment) and have been told by friends that if I pay the fees upfront then I can claim them as a deduction however if I put them to hecs/help this is not deductible.

    Thanks so much.

    • techboy on 03/06/2017 - 12:53

      (1) If the main purpose of the trips are work related and your own purchases are incidental then yes you can claim the km's travelled up to 5,000 km per car per owner.

      (2) When you moved out, where did you go?, buy another house or rent another house?

      (3) Hecs/help fees can not be claimed but any other expenses related to studying, including fee costs can be claimed under self-education.

      • Jmack on 03/06/2017 - 14:36

        We moved into government housing that we rent off them. Also in regards to travel we would do more than 5000km a year doing this along with the other work related travel.

        Thanks for your response

        • techboy on 03/06/2017 - 15:54

          If you are renting another house the your Principal Place of residence will still be the rental property and as you moved in straight away before renting it out you can be absent for up to 6 years before paying any capital gains tax on it. So if absent for 6 years and then sell it no CGT, if absent for 8 years then you would pay CGT on the 2 extra years so 3 years 2 months + 8 years = say 11 years so you would pay 2/11 of the difference when you sell it.

          As I said 5,000 per car per ownwe is the maximum you can claim unless you use the 'log-book' method.

  • ultra64 on 03/06/2017 - 10:36

    One more question. If I earn less than $20k driving uber during the financial year am I able to claim instant deduction buying a car up to the amount I earn?

    • No ONE on 03/06/2017 - 11:41

      Why would you do that. You will nearly save a few hundreds (~$300). Why not use depreciatition and also bring down your tax next year if you earn a lot more. Don't make that mistake of claiming at once when your income is so low from uber.

      Say your car is bought at 20k, you will virtually have zero loss. you will be the loser next year (pay tax with less deductible) and ato the winner.

      Remember the first $18,200 is tax free. So you will be paying tax on $18,200 - $20,000 (supposed income) = $1,800.

      • ultra64 on 03/06/2017 - 16:49

        Supposedly I earn $15000 from uber. And I buy a $12000 car. Would it then be advantageous to claim instant deduction.

        • No ONE on 03/06/2017 - 18:07

          Well do you have any other income?
          Yes, then you might take advantage,
          No, no take advantage

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