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I have a solution to deal with the short term letting market. Properties, whether houses or units, that are wholly let on the short term rental market should not be able to claim negative gearing.
This immediately will free up some properties and also assist deal with Labor’s previous plan of limiting negative hearing. Want to negatively gear, sure can! But only if you permanently rent your property.
The true sharing economy – people renting a room out in their home to make some money, or even home owners renting their own (non-negative geared, coz they live there) home out over holiday periods etc are not affected.
And it should be noted when we speak of the urgent need for full time rental accommodation that, whilst undoubtedly the worst to suffer are people who can’t get a permanent rent.
We’ve just been in Port Douglas where to what should be a national disgrace young overseas workers are renting a shared tent at the backpackers for $200 a week – people who live near full time air bnbs – whether units or houses, also suffer from a merry go round lottery of new short term neighbours.
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“please explain” Should be a national disgrace?
I think the OP means it should be recognised as a national disgrace that people are being charged $200 a week to live in a tent. Or don’t you agree?
The opinions offered in these Forum posts and replies are not intended to be taken as legal advice. Readers with serious issues should consult experienced strata lawyers.
In the world of a heart-breaking lack of rentals, here’s a nice story about someone doing his bit… The remarkable story behind Chermside Salvation Army complex | 7NEWS – YouTube
I wonder how many properties on short term rental platforms are negatively geared, vs those that are positively geared? The increased income from short term let rather than long term would actually make it less likely that the property is negatively geared.
The suggestion would also not have any effect on those who are renting a property (or properties) on the long term lets market, and then placing them full time or part time on short term letting platforms.
I wonder how many properties on short term rental platforms are negatively geared, vs those that are positively geared?
According to the SMH this morning, the ATO is about to crack down on claims by investors who are deliberately under-pricing their holiday lets for friends and family. Also, the term “negative gearing” is misleading. I believe all that’s required is that you claim the expenses of your investment rentals against your income. And you don’t have to be in the red to get significant tax breaks. All you do is reduce the income from the holiday lets by the amount of expenses and then you are taxed less.
That said, it seems a bigger issue is the under or non-declaration of holiday let income. Maybe just hunting them down and taxing them would be enough. The new register of holiday lets in NSW could be a happy hunting ground for the taxperson.
The opinions offered in these Forum posts and replies are not intended to be taken as legal advice. Readers with serious issues should consult experienced strata lawyers.
I agree with Wichita, as this would force holiday makers back into hotels and motels, and out of body corp accommodations.
As a former university staffer I noted that thousands of overseas students buy investment properties to live in while studying, and yet they remain empty when they return home.
Attempts to regulate AB+B’s customers via the tax system is littered with so many opportunities for lawyers to have a field day trying to define what is meant by say, the word “permanently”, as the OP wrote (in regards to “negatively gearing”, which as someone pointed out really refers to the right to offset expenses against the income generated via AB+B)
“But only if you permanently rent your property
Others over time, and Jimmy in this thread, suggest the ATO may go out and hunt down these short term lessors, many of which may be coy with just how much short term letting they are undertaking. I agree they will be coy.
Instead of defining “short term” with the aim of tackling short term hosts one by one, I think the ATO should look for the cheapest way to snare these self interested, self centred individuals and I suggest that would be to levy a tax not on the thousands of “hosts” but instead to levy a tax on the payments made by guests to the short term aggregation platforms such as AB+B, Expedia (under its garage of brands including, Vrbo, Vacation Spot, Stayz etc) and so forth.
Of course the platform providers will in turn sheet home this cost to the “hosts”, so mission accomplished.
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