Owning rental property is an addiction here in New Zealand. Just about everyone I know has a rental property. Some even rent or flat share in more “desirable” locations than they could afford to buy in but have one or two rentals in other suburbs.
Yet with all these rental properties, the government sees very little tax revenue because of the level of negative gearing put in place. Whether you own the rental property through a trust, a company (usually an LAQC – Loss Attributing Qualifying Company) or even just as an individual, the gearing most people go for is the costs associated with that property barely cover the mortgage and rates, and then the depreciation on buildings and the like can be applied to other PAYE based income.
Read more: http://www.karlrohde.com/2009/10/tax...o-think-about/
Cheers
Marc
Yet with all these rental properties, the government sees very little tax revenue because of the level of negative gearing put in place. Whether you own the rental property through a trust, a company (usually an LAQC – Loss Attributing Qualifying Company) or even just as an individual, the gearing most people go for is the costs associated with that property barely cover the mortgage and rates, and then the depreciation on buildings and the like can be applied to other PAYE based income.
Read more: http://www.karlrohde.com/2009/10/tax...o-think-about/
Cheers
Marc
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