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  • ATO


Abreviation for Australian Taxation Office.



  • Capital Gains Tax


A tax payable when / if you sell a property.

It's a tax on the increase in the capital value of investments.

Capital Gains Tax is indexed so that nominal increases in value due to inflation are not taxed as well.  The taxation regime also allows capital losses to be offset against other taxation liabilities (e.g. income tax) in certain circumstances.

This is the tax you pay when you sell an investment property if you've made a profit.




Taxable Income

  • Depreciation


As buildings get older and items within it wear out, they depreciate in value.

The Australian Taxation Office allows property investors to claim deductions relating to the building (Capital Works) and Plant and equipment items in it.  The owner of an income-producing investment property can claim depreciation;

this has the effect of reducing their taxable income, meaning they pay less tax.


  • Capital Works


The capital works allowance is a deduction available for the structural element of a building including fixed 

irremovable assets; this is commonly referred to as the building write off.  Only some properties will qualify for this

allowance.  For residential buildings constructed after 16 September 1987 your accountant can claim 2.5 per cent

of its historical construction cost.


  • Plant & Equipment


Refers to removable items in the investment property like carpet, hot water systems, blinds, light fittings

and many other items.


  • PPOR or PPR


Principal place of residence.  Generally, a residence is your PPR if you live in it (with your personal belongings)

on a daily basis.  Other factors may be used to determine whether a residence is your PPR, such as:


  • Where your family lives


  • The extent of time you live in the residence


  • The address you have your mail delivered to


  • Whether utilities (e.g. electricity, gas & telephone) are connected to the dwelling and the account(s) are in your name


  • If the address of the residence is recorded against your name on electoral roles .

  • Tax File Number (TFN)


A number allocated to taxpayers by the Australian Taxation Office.

The TFN is used by the Australian Taxation Office to match income and taxation details.





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