Yup, we've managed to confuse ourselves...

[JABlog]

after 3 audits i say tell them nothin

Did you had a feeling they would come knocking? How do they conduct audits - random or otherwise?

[AucklandNZGuy]

I dont think I need to declare tax - I have 4 boarders each paying or $155 including food. Its a primary house... with rooms rented out. Below the limit according to my basic research.

Thanks for the feedback those guys, it's a good reality check... based on this, we've crossed out the apartment option which is a start. I'm a little confused by the company set up but will be need to get some accounting feedback as we get closer. I think we're going to stay looking at peninsular vs anywere else at this stage. Looking at a house today, $450k with rental income of $460 so it's a start.

Can't post links... but the link said:

The standard-cost method uses an average price for basics such as the cost of food, heating, power and transport. The amount is an average across the country and is inflation-adjusted annually. If your income from boarders is less than the standard cost allowed, you will not have to file a tax return, keep records of related expenditure, or pay tax.
The current year’s rates (year ended 31 March 2012) will be adjusted for inflation after 1 April 2012.
For the year ended 31 March 2011

one or two boarders	$243 a week for each boarder.
three or four boarders	$243 each for the first two boarders, and $198 for each subsequent boarder

[jimO]

Did you had a feeling they would come knocking? How do they conduct audits - random or otherwise?

they were after my accountant at the time i had a gst audit then within months a full tax audit (which found i had overpaid by $1200, they said because it was our mistake they didnt have to repay it but they did) then the next year another full audit, the tax inspector said that it was a random pick by computer but i doubt it my accountant had several of his clients audited and he was as straight as you could get, my present accountant isnt