Leigh & Alister
Its all to do with intent, even if you did own a house for 10 years, if
you bought 100% financed
on a sub-prevailing mortgage rate return then it would be relatively
easy for the IRD to argue that
your intent was to get capital gains (therefore taxable), I bought my
rental for about 220K and it was returning 20+K gross
therefore no issue, but the same building now has a value of 600+K and
would struggle to return 30K rent,
If you financed it more that 50% you'd be asking for trouble.
There are so many people doing this that their only protection is
numbers (sort of fiscal civil disobedience)
the IRD could not cope with the work required. What possibly will happen
though is that under politcal
pressure the IRD will draw a line in the sand and say this is it, they
will then persecute some poor prick to
establish case law, then watch the fur fly!
I doubt this will happen in the current pol climate thou because labour
need the middle class to vote for them.
Helen (though her behaviour doesn't show it) knows that social
democracies get support because they assuage middle class
guilt not because we are card carrying socialists.
Neven
I don't think that the house bought for renting and hold one house for 10
years and ird will treat it as trading house as business to make profit.
Thus no need to pay tax on the capital gain.
Regards
Leigh
www.smootharm.com
-----Original Message-----
From: [EMAIL PROTECTED]
[mailto:[EMAIL PROTECTED] Behalf Of Alister Christie
Sent: Monday, July 30, 2007 11:57 AM
To: NZ Borland Developers Group - Offtopic List
Subject: Re: [DUG-Offtopic] RE: [DUG] basic question
If your banking on capital gain, your not an investor, your a speculator
and therefor might be up for capital gains tax if you sell.
Alister Christie
Computers for People
Ph: 04 471 1849 Fax: 04 471 1266
http://www.salespartner.co.nz
PO Box 13085
Johnsonville
Wellington
Leigh Wanstead wrote:
The money paid to tax is lost permanent. There is no way to get the money
back. The house price is always up and down. If you are willing to wait in
long term(let's say 10 years term), the house price is always up. ;-)
Regards
Leigh
www.smootharm.com
-----Original Message-----
From: [EMAIL PROTECTED]
[mailto:[EMAIL PROTECTED] Behalf Of Alister Christie
Sent: Monday, July 30, 2007 9:40 AM
To: [EMAIL PROTECTED]; NZ Borland Developers Group - Offtopic List
Subject: Re: [DUG-Offtopic] RE: [DUG] basic question
Negative gearing property, is just stupidity. It's basically spending 3
dollars to make 2 dollars and then hoping property prices will rise
(although this has happened a lot lately) and is very risky. I don't
understand why people loath paying taxes so much that are willing to
lose money to do it.
Alister Christie
Computers for People
Ph: 04 471 1849 Fax: 04 471 1266
http://www.salespartner.co.nz
PO Box 13085
Johnsonville
Wellington
Todd Martin wrote:
I believe the top personal tax rate has played a significant role in
fueling
the housing boom. Let's face it, negatively gearing property investment
is
the only option open to middle class salary earners to reduce their tax
exposure.
With high interest rates, comparatively low rents and no great tax break,
many
of these people would flee the market. I think many would never have got
into
it in the first place without the 39% tax bracket.
Futhermore, while I agree that some people would spend their tax cuts, if
they
got the chance, the ones paying most of the tax are also probably better
able
to manage their money and would be more inclined to save/invest or reduce
debt. That should have a positive effect on the economy and everyone
would
benefit.
I think there is too much prevalence of the "tax those filthy rich
bastards"
mentality in the NZ psyche.
Todd.
On Fri, 27 Jul 2007 16:41, Phil Scadden wrote:
The point is that at 40% of GDP the govt is the biggest spender, also
we
have huge increase in
bureaucracy which tightens the the labour market.
And doesn't this simply reflect WHO is spending the money? The
government
is not borrowing to fund spending. The alternative would be tax cuts. do
you think the people getting the tax cuts are less inclined to spend
than
the people who getting the money via government spending? I agree that
growth of central government size is a worry but in perspective, the
increase is small.
For all the resource the government has at it
disposal no-one has categorically stated what is fueling the housing
market, tho I suspect it is
(in Auckland anyway) migration coupled with shortage of supply which
no-one politically wants to admit
And in South it is wealthy amercans buying up land for variety of
reasons.
I agree migration is issue. I also find that its impossible to find
suitable people inside NZ so of course we are bringing more immigrants
in.
But we could lose the speculators thank you.
As for KS, do i want to sign away 8%-12% of my income for the next 10+
years into badly managed funds
Is there a well managed fund? Some of the offering look pretty
competitive.
I am still making by mind but it seems that with combination of other
investments and KS, this has to be worth looking at. If the funds dont
do well, then time for holiday. however I am only 15 years out from
retirement so pretty much got that sorted.
----------------------------------------------------------
Phil Scadden, GNS Science Ltd
764 Cumberland St, Private Bag 1930, Dunedin, New Zealand
Ph +64 3 4799663, fax +64 3 477 5232
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