I have two investment properties. One is owned by LTC and another in joint name. I hold 99% share in LTC whereas my wife has 1%. I am earning 80K PA and my wife earns 26K. Due to lower interest rate both properties are now positive gearing (profit PA LTC -10K , joint 20K). To make tax efficient i want to change share holding pattern of LTC (1% me , 99% mywife) and sell jointly owned property to LTC. What will be the implication?
I purchased both rental properties in 2015-2016 hence does not attract any tax on the capital gain, which is around 400K. But depreciation recovery is a concern. I got a valuation of chattels for both rentals at the time of purchase. Is it possible to avoid depreciation recovery? If I take the depreciated value of chattels as an initial value once transferred to LTC The original price of chattel is 70K & 62K for LTC and joint rental respectively whereas opening value as on 31st March 2020 are 40K and 35K.
Regards,
Dinesh
I purchased both rental properties in 2015-2016 hence does not attract any tax on the capital gain, which is around 400K. But depreciation recovery is a concern. I got a valuation of chattels for both rentals at the time of purchase. Is it possible to avoid depreciation recovery? If I take the depreciated value of chattels as an initial value once transferred to LTC The original price of chattel is 70K & 62K for LTC and joint rental respectively whereas opening value as on 31st March 2020 are 40K and 35K.
Regards,
Dinesh
Comment