The Consumer Thread

bellenuit said:

I was simply wondering if a substantial discount to market rates for the purpose of providing a charitable community service would be viewed by the ATO in the same way they view mates rates, where the purpose of the latter is to provide assistance to a family member or friend at the expense of ATO revenue and is also open to abuse (the tenant and owner splitting the amount of tax saved between them).

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bellenuit said:

No, that is not what I meant. If you have a rental property that should command a market rent of $12,000 pa and you rent it to a friend or family member for just $8,000 pa say, then if your total rental expenses come to $6,000 pa, the ATO will say that only $4,000 of your rental expenses are deductible. You are renting for 2/3rd it’s market value, so you can only claim 2/3rd of the rental expense. This is to ensure that not-at-arms-length tenants aren’t used to abuse the system.

I was just wondering if the same applied if you are doing it for charitable reasons especially when the tenant is not friend or family.

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SirRumpole said:

Such people are providing a service to the community by providing housing to those who can't afford to pay the market rate, they are reducing the need for social housing and taking the pressure off government, why on earth would you want to discourage such generosity ?

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