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Deductability of Buyers Agents fees?

Discussion in 'Accounting, Tax & Legal' started by Jacque, 28th Sep, 2005.

  1. Jacque

    Jacque Team InvestEd

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    Nick,
    I know you would be the best person to answer this :)
    I have been asked by a few investors now if BA fees are tax deductible. In my research, however, I haven't been able to find a definitive answer. Some accountants say yes, whilst others disagree.
    Do you know if they are tax deductible for investors?
     
  2. Simon Hampel

    Simon Hampel Co-founder Staff Member

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    My non-professional opinion is that at best it could be considered an acquisition cost - and hence would be added to the cost base of the property for CGT purposes.

    That is unless you are running a company that trades in real estate - hence buying and selling is your income source, and that would make a buyers agent fee an operating expense.

    I'm happy to be corrected here - NickM ?
     
  3. Bob

    Bob Well-Known Member

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    Buyers agents fee

    My experience in the past has been that it is all in the wording of the buyers agents contract. The lease options I have had were determined by my accountant in Canberra to be capital expenditure. I am now a client of Nick so perhaps he can clarify?? Thanks

    Bobby
     
  4. NickM

    NickM Co-founder Staff Member

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    sorry for the delay in my reply guys but i am in sunny Qld having some time out ! still make time to see what deals these dodgy agents try to put together in order to crack a sale of a GC apt

    Buyers agent fees are capital. A portion may be deductible IF the BA helps to place a tenant and the invoice should allocate a portion for that component accordingly

    NickM