How can I be more tax efficient with overseas investment?

Question from allen updated on 22nd January 2009:

I have rental property in Adelaide, mortgage 450 p/w week, rental income 340pw. I work in New Zealand, can I use this to be more tax efficient in New Zealand, how do I do this

Our expert responded:

As a New Zealand tax resident, you are required to include in your tax return all of your world wide income, which will obviously include your property in Adelaide. Even though the property is located in Australia, when the property is accounted for here in NZ, it is done according to NZ tax law, not Australian tax law. Any loss from the property is offset against your NZ income and your tax reduced accordingly. As the property is located in Australia, you should also be filing a tax return with the ATO for the property and it should be accounted for under Australian tax law.

Kenina Court is a director of Acorn Solutions Limited, an accounting firm dedicated to working with clients to help them create wealth.  She is an avid property investor, entrepreneur and seminar presenter on asset protection and wealth strategies.




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