Govt curbs property tax deductions
THE federal parliament has passed legislation to limit tax and depreciation deductions claimed by residential property investors along with a vacancy tax for foreign owners who leave homes unoccupied.
Treasurer Scott Morrison and Assistant Minister Michael Sukkar said the reforms will help address housing affordability and assist private renters.
The Treasury Laws Amendment (Housing Tax Integrity) Bill 2017 will disallow certain deductions relating to residential investment properties.
Morrison said the changes disallow claims for travel expense deductions and limit plant and equipment depreciation deductions to assets not previously used.
Depreciation will only apply where the depreciating asset was acquired new – this reform is expected to raise $260 million over forward estimates.
The Treasurer said limiting plant and equipment depreciation deductions will remove the existing opportunities for items to be depreciated by multiple owners in excess of their actual value.
For second hand residential properties purchased after May 9, investor will only be able to claim depreciation for plant and equipment assets where the depreciating asset was acquired new for that purpose. Continue reading
Building Developers and Owners are Being Sandwiched
Costs, Risks and Returns are being impacted by uncertainty around the future acceptability of Aluminium Composite Cladding Panels (ACP).
Since the Lacrosse Apartment building fire in 2014 and the tragic Grenfell Tower fire of 2017, there are still more questions relating to the use of flammable ACP than answers.
Industry, governing bodies, financiers, building owners and occupiers, are yet to really understand their options.
- Will the import and use of flammable ACP in Australia be banned? – one of the suggestions made by the Senate’s interim enquiry report.
- Will the National Construction Code and Building Regulations be revised to require increased fire safety around the use of ACP? – as suggested by the current draft amendment out for public comment.
- Will the ‘grey area’ of whether the ACP is an attachment or part of an external wall be confirmed?
- Will Government required audits lead to large scale removal of flammable ACP and replacement with compliant materials?
- Will insurers carve out flammable ACP from insurance policies? Will premiums increase?
- Is the reputation of ACP tarnished so much so that developers and architects turn their back on the material – as recently reported by Uniting Communities with their U City development in Adelaide? Continue reading
