zaph

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About zaph

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  1. You're welcome. I did a B. Commerce majoring in accounting in another life, but never really pursued it. That training allows me to know the questions to ask google and translate it to simple language when I don;t know the answers off the top of my head. I quite enjoy answering your kind of posts - makes me keep at least a bit up to date. I'm far far from an expert. Those sort of shows always exaggerate profit. It's up to almost 2 years and up to almost one year depending if you sell on the 29th June or the 2nd July. If they were flipping 4 houses a year that would be business/ordinary income (the houses would be considered trading stock rather than investments) and they would definitely be paying income tax rather than CGT1. If they were doing it that regularly they would be paying instalment tax - monthly or quarterly. Instalment tax is like the tax your employer pays to the ATO as an estimate of what your final yearly tax due would be. 1 - They would be trying hard to classify it as CGT. But at even one a year regularly it would be ordinary income.
  2. CGT on the retained unit is only payable after sale. No income tax on the increase in value. CGT on the house would be payable after sale too. However, it may be deemed that this couple are in the business of flipping and the profit would be treated as ordinary income. If they owned the house for less than a year it wouldn't make a difference to the tax. If owned for more than a year and they can claim it was a CGT event and not ordinary income they would get the 50% discount. CGT is included in an individual's tax return due end of October if doing yourself or around May if using a tax agent. Tax payable will be due a month or two after lodging. So if selling on July second and using an accountant CGT would not be payable for almost two years.
  3. What problem? I presume the increase in the price of housing? That's only happened in Melbourne and Sydney in this low IR setting cycle. Why is that? I don't read the Armstrong thread. Perhaps I should. The Australian government can not become bankrupt. It borrows in Australian dollars and can print more at will.
  4. A mortgagee is the bank, the lender. A borrower is a mortgagor. If the RE bubble pops I would guarantee ZIRP, possibly NIRP and other creative 'solutions' to the 'problem'.
  5. But that would not be appropriate for today. The OCR has been as high as 17% or as low as 1.5% that it currently is. It's important that it's appropriate for the time. An OCR of 6-8% would mean a mortgage rate of 8-10% - that would cripple the economy ATM. I get your point about grannies on fixed interest, but the RBA doesn't care.
  6. I believe the next RBA move will be a reduction in the OCR. Most likely to 1.25% - a 25 basis point reduction. Inflation is still below the bank's target. Let's see what CPI is in the next couple of days - if it's less than 2% then I predict the RBA will reduce the cash rate sometime in the next couple of months. Sorry savers.
  7. That currently happens. Although it is very influenced by the RBA OCR. Deposits are currently around 2.5% +/- tip and mortgage rates are around 5% +/-tip. There's nothing stopping the Cobran bank from taking deposits at 5% and lending to Zaph at 8%. With that deal Cobran will take lots of deposits, but not lend anything. What do you think is an appropriate RBA OCR for Australia's present circumstances?
  8. I don't believe that. ZIRP in some jurisdictions may not have lead to marvellous results. But without low IRs, the economy may have had a depression. What rate do you think has no effect? The problem with fiscal policy is it's up to politicians. Bad times - spend up to stimulate. Good times spend more - we deserve it.
  9. Interesting point, and one that is never considered in IR policy. However, there are far more borrowers than savers so monetary policy is dictated by them. Almost all businesses use credit to invest. When rates are lower investment is cheaper and more likely. RBA's focus is inflation. Inflation. Inflation. Keep rates as low as possible while limiting inflation. Although that is not the actual RBA mandate. It's just what they use to 1. maintain the currency;s stability, 2. full employment, 3. economic prosperity of Australians.
  10. Not hard for Labor to be ahead. The libs have no policy, just hand waving that changes daily. Cuts to immigration would have an effect. Raising rates would have the biggest effect. But an increase in IRs is not justified outside the housing sector.
  11. Who knows? He was stupid enough to go for one last year when a grade 9 political student could tell it was the worst idea. May have worked out what all the advertising is. Departments spending up their budgets close to the end of the fin year so they get the same allocation next year.
  12. There's been a huge amount of govt pointless advertising in the last week. Small business ra ra -higher wages. NBN. Champagne for everyone. If the last election wasn't held less than a year ago I'd be sure one was around the corner. Who knows, Turnbull was stupid enough to go for a DD maybe he'll do it again. (don't think he has the triggers)
  13. It's an above average home in an above average area, so it's not really fair to assume it should be available to an average family. If your kids are adults then you're probably not familiar with the rivers of gold that are family tax benefits. With five kids these days you'd be getting close to a grand a week in welfare. Maybe more - you need a doctorate to work it - a simple look at the Centrelink site is not clear.
  14. 4077th?