Wednesday, 28 May 2014

QLD Coles project to bring new stores and 700 jobs to Ipswich

Coles project to bring new stores and 700 jobs to Ipswich.

Ipswich Coles customers Leah Petersen of Raceview with her daughters Emily, 11, and Hayley, 9.
Ipswich Coles customers Leah Petersen of Raceview with her daughters Emily, 11, and Hayley, 9. David Nielsen
COLES will build three new stores in Ipswich including a second super store and create more than 700 jobs.
The supermarket chain announced this week they plan to open a super store at Springfield Orion's shopping centre,
Redbank Plains Rd

and another on the former site of the Bremer State High School.

It follows the opening of Queensland's first super store Coles in the Ipswich CBD, rebuilt after the 2011 floods last year.

The stores are part of a $480 million expansion of 31 stores across the state.
A Coles spokesperson said the locations were identified as major growth areas within south-east Queensland

"We are delighted to be investing in opening new stores at Springfield, Redbank Plains and on the former site of the Bremer State High School," the spokesperson said.
Mayor Paul Pisasale said the stores will create much needed jobs for Ipswich's youth.
"The stores are determined by growth. What we are seeing in retail development is Coles and Woolworths competing for market share, so it's going to be good for the consumer," he said.
Coles General Manager for Queensland and Northern Territory, Mark Scates, said the $480 million investment in new stores reflected Coles' confidence in the future of Queensland as the company celebrated its 100th birthday.
"We are delighted to be investing in Queensland and generating more jobs in the community with the roll-out of new market-style supermarkets for shoppers," he said.

"As we roll out more supermarkets with a bigger and better range of products, we will also be supporting local producers who grow and manufacture the highest quality food for Queenslanders." 

Monday, 26 May 2014

QLD Toowoomba Brisbane West Wellcamp airlines almost lined up: Wagner

Brisbane West Wellcamp airlines almost lined up: Wagner

Cameron Atfield
The runway starts to take shape at the Wellcamp airport at Toowoomba. Photo: Supplied

The operators of Australia’s first privately-built major public airport say passenger airlines will be flying in and out of Toowoomba as soon as construction is finished in October.

And the Brisbane West Wellcamp Airport, under construction about 17 kilometres west of Toowoomba, could also operate as a landing strip for diverted international flights, according to project chairman John Wagner.

That would potentially see Boeing 747s and Airbus A380s landing at the Darling Downs airport.
Bosses of Wellcamp airport at Toowoomba expect to be open for business this year. Bosses of Wellcamp airport at Toowoomba expect to be open for business this year. Photo: Supplied

“Typically, when Brisbane goes out so does the Sunshine Coast and the Gold Coast – the Gold Coast is very marginal with weather, they’ve got a short runway so they can’t take a jumbo or an A380, but we can,” Mr Wagner told a Rural Press Club lunch in Brisbane on Tuesday.

“… If we’re going to take international flights in, we’re going to need to have people like AQIS, Customs and Immigration ready to move to be able to accommodate that, rather than sending everyone to Sydney and putting those people a good day out of their way.”

Discussions had been held with Toowoomba-based bus company Stonestreets about transporting passengers from Wellcamp to Brisbane.

“If we do take a diversion from Brisbane, we’ll be able to get them off, process them and get them to Brisbane in a reasonable timeframe,” Mr Wagner said.

Mr Wagner said his family was spending “north of $100 million” on the airport, which will be the first privately funded major public airport in Australia.

Mr Wagner told the lunch he expected up to 500,000 passengers to go through the airport in its first year of operation, which could grow to 1½ million passengers within five years.
“We’re in final discussions with two of the major airlines and one of the secondary airlines and I believe we’ll have at least two – maybe three – airlines running out of Wellcamp in October this year,” he said.

An announcement is understood to be imminent.
But Mr Wagner conceded the 2.87-kilometre runway – which would allow it to accommodate the larger passenger jets – was not necessarily required in the region.

“The reason we took on that decision making process and agreed to do it was that we had one opportunity from a town planning perspective, and particularly a federal government perspective, to get this through the system,” he said.

“Our view is that Toowoomba really only needed an 1800-metre- long runway, which is similar to the Sunshine Coast, however what (the longer runway) gave us was a piece of infrastructure that will see my children and my grandchildren out without having to go through any more approval processes.

“At the end of the day, it’s really only more gravel, more concrete and a few more lights and what it allows us to do is take a 747, fully loaded, direct to Asia.”

The Wagners have identified Sydney, Melbourne, Cairns, Canberra, Adelaide, Roma, Mackay and Emerald as potential regular destinations from Brisbane West Wellcamp.
Mr Wagner said the runway was on track to be completed next month, while the passenger terminal was expected to be finished in September.

Work on the airport started in April last year.

The Wagner family, with its background in cement, has owned the airport site since 1994, when it bought it for use as a quarry.
Along with the airport, the company is building a large business park.

Sunday, 25 May 2014

Husband and wife can obtain life insurance via their SMSF and link the two policies so they only pay one policy and stamp duty fee.

Husband and wife can obtain  life insurance via their SMSF and link the two policies so they only pay one policy and stamp duty fee.

We recently sat down with a Wealth Manager RYAN KEIGHER  in Paddington QLD. 
They are in QLD but with insurance its an Australia Wide thing so no problems calling them on the phone if you are out of state.
I immediately liked talking to Ryan as he had some smart advice and some CLEVER options that could save us money.
We talked about SMSF and Life Insurance options.
We combined our insurance as a couples life insurance and now halved the rate with the same Payout Benefit. 

They also do the SMSF investment into shares etc. But they said if we are property investors and want to invest ourself in property instead then they 
happy to just get us a great life insurance and be there if we need anything else. RYAN is your man , so if your talking to him to get your quote.
mention Jason and Amy’s clients and their joint life insurance deal is something you want a quote on.

Here is a email from Ryan explaining about Insurance etc.
There are a number of different strategies that can be adopted when taking out any type of insurance policy.  
For example, a husband and wife can obtain  life insurance via their SMSF and link the two policies so they only pay one policy and stamp duty fee.
For property investors, it is crucial that you are financially secure for the unexpected in the event of illness or injury.  Not only providing emotional and financial peace of mind, it will also provide you with the ability to continue to pursue your property investing objectives. 
Income Protection Insurance cover will pay a regular income if a person is unable to work due to illness or injury.  The maximum benefit is usually 75% of the person’s salary package.  Different strategies are adopted to maximise your levels of cover according to your term of employment ie. full-time employee or self-employed. 
Trauma/Critical Illness Insurance cover provides a lump sum payment for a person who suffers a major specified health trauma such as but not limited to cancer, heart attack and stroke.  These funds can be used to pay for reduce debt, medical treatment or to meet living expenses.
All of the above mentioned insurance products except Trauma/Critical Illness Insurance can be held via your superannuation fund or SMSF.  Dependent on your own personal situation and objectives, it may be advantageous to structure your insurance policies to be paid via your superannuation fund or SMSF.  Some of the benefits include:
·         Tax-effective – insurance premiums are paid from the lower taxed environment in super (15%) compared to being paid by your after-tax income which is taxed at your marginal tax rate (32.5% - 45%)
·         Salary sacrifice – you can also make contributions to your superannuation fund under a salary sacrificing arrangement which will not only reduce your taxable income but also fund your insurance premiums
·         Cash-flow – as your superannuation pays the insurance premiums, you gain access to the adequate levels of insurance cover without the financial burden on your cash flow budget
·         Discounted insurance – due to economies of scale, you gain access to purchase insurance policies at a lower rate

Astute Wealth Management is able to assist property investors with insurance, superannuation, SMSF, wealth creation, retirement planning, budgeting, cash flow management, ethical investing, mortgages and general insurance.


Ryan Keigher B.Bus(Mktng&IntBus), DipFP
0402 645 573
Financial Adviser – Authorised Representative of WealthSure
Astute Wealth Management Pty Ltd
Corporate Authorised Representative of WealthSure

Saturday, 24 May 2014

QLD: A New Era for Property Transactions in Queensland – Property Occupations Act 2014 to Replace PAMDA

Australia: A New Era for Property Transactions in Queensland – Property Occupations Act 2014 to Replace PAMDA

Real Estate Alert
Last Updated: 12 May 2014
Article by Kylie Maxwell and Mark Foy

New Legislation Replacing PAMDA

The Property Occupations Act 2014 (POA) was passed on 6 May 2014. The date of commencement has not yet been announced or proclaimed.
Those familiar with property transactions in Queensland will welcome the POA and the repeal of the Property Agents and Motor Dealers Act 2000 (PAMDA). This is because the new legislation should:
  • simplify the contract formation process
  • reduce incidences of contract termination and disputes for non-compliance.

How will Property Transactions be Affected?

  • The definition of 'Residential Property' has been simplified. Contracting parties will have greater certainty on whether the POA will apply to a transaction.
  • The PAMDA Form 30c Warning Statement and Body Corporate and Community Management Act 1997 Information Sheet will no longer need to be attached to contracts. Instead, a prescribed statement must be written in a contract immediately above and on the same page where the buyer signs.
  • If the prescribed statement is not included, the buyer will not be able to terminate the contract. The seller or the seller's agent who gave the contract to the buyer instead commits an offence and a financial penalty of up to AUD22,000 may be imposed.
  • A buyer's attention will no longer need to be directed to the PAMDA Warning Statement.
  • The buyer's cooling-off period for a relevant contract of five business days remains.
  • The cooling-off period may be shortened or waived by giving written notice to the seller. The Form 32a Lawyers Certificate required under PAMDA will no longer be necessary.
  • The cooling-off period will only apply to an option agreement and not the contract that may be formed subsequently upon exercise of the option, except where a third party, such as a nominee, exercises the option.
  • Real estate agents' commission rates have been deregulated.
  • The requirement for including the prescribed wording in the contract and the cooling-off period will not apply to a property sold at auction or entered into with a registered bidder by 5 pm on the second business day after being passed in at auction.

What do I Need to do Now?

This Legal Insight is a snapshot of some of the changes that will impact property transactions. There are numerous other changes affecting licensing and the appointment of real estate agents, disclosure of estimated sale prices and option deeds.
To prepare for these changes, it is now time for:
  • developers to review and update precedent off-the-plan contracts
  • sellers (including mortgagees/liquidators/receivers & managers) to review contract documents and sale procedures. Where contracts have been issued to buyers or agents in anticipation of sale, these contracts and processes may need to be changed, depending on the commencement date of the POA
  • real estate agents to review internal processes and precedents, consider if contracts which are not yet signed will need to be changed in preparation for the commencement of the POA and review appointment agreements.
PAMDA will continue to apply to a relevant contract entered into before the commencement of the POA which has not yet settled.
It is imperative that all those involved in Queensland real property transactions be vigilant in monitoring and preparing for the commencement of the POA.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

Friday, 23 May 2014

WA Neighbours fight golf course rezoning

Neighbours fight golf course rezoning

Neighbours fight rezoning of golf course
The West Australian Picture: Ian Munro
WA golfers have been urged to join the fight against plans to redevelop South Guildford's Rosehill golf course, with opponents claiming the move could spark course closures around the State.
Rosehill, which has been owned by the Gatti family for decades, was recently sold to a developer which wants the land rezoned for a housing estate.
Residents whose homes back on to the course said it would set a dangerous precedent by encouraging other private owners to cash in on the demand for land.
"If Rosehill is rezoned urban, it will be very difficult for the Government to reject the next golf course rezoning application and the next one after that and the next one after that," South Guildford Action Committee chairman John Squire said.
About 200 residents with homes bordering the course rallied at the weekend, calling on golfers around the State to voice their concern when the rezoning application is put out for public comment next month.
The City of Swan has given in-principle support, but the WA Planning Commission makes the final recommendation to the minister.
The new owners of the course, Rosehill Waters Pty Ltd, are yet to release development plans, but it is understood about 600 lots have been proposed for the 47ha site.
Residents claim the redevelopment would impact heavily on their lifestyle and some had paid a premium for lots overlooking the course.
But Rosehill Waters general manager Sandra Bransby said residents were warned when they bought their blocks that the Gatti family did not support development around their course. The Gattis also did not profit from the sale of land around the course.
"It is not zoned recreation and it is not an area of public open space … it has always been privately owned," Ms Bransby said.
"We hope that people will see that (the development) will actually in the long-term be a benefit for the whole area and not just those that have a view on to the course."
Golf WA chief executive Gary Thomas said he sympathised with Rosehill residents, but did not share their concerns about other golf courses following suit.
"We do not want to see any golf courses lost … but most of those that are in private hands are highly successful and profitable businesses," he said.

Thursday, 22 May 2014

QLD: Changes to Queensland residential property law to remove loopholes allowing buyers to terminate for technical breaches

 QLD: Changes to Queensland residential property law to remove loopholes allowing buyers to terminate for technical breaches

In brief - Property Occupations Act to simplify contracts for residential property

Recently the Property Occupations Bill 2013 was passed in Queensland to replace parts of the Property Agents and Motor Dealers Act (PAMDA), which has been in place for some time.
The new legislation aims to simplify how contracts for residential property in Queensland are formed and removes what had been potential loopholes allowing buyers to terminate for technical breaches of PAMDA. The new legislation also changes how real estate agents are licensed and appointed.
A date for the new legislation to commence has not yet been set.

Warning statements no longer required

Once the new law commences, a prescribed warning statement will no longer be required to be attached to the contract. The requirement to attach an information sheet for a unit sale will also be removed.
Instead, particular wording will be required to be inserted on the signing page for a contract to buy residential property.
Importantly, if this requirement is not met, a buyer will no longer have a termination right. Instead, a fine of up to $22,000 may apply to the vendor or the vendor's agent.

Change to definition of residential property

Residential property will be defined to mean property that is used or intended to be used for residential purposes, but excludes property used primarily for the purposes of industry, commerce or primary production.
This definition is simpler than the definition in PAMDA. It remains to be seen whether the new definition will result in litigation, given the removal of the contractual termination right for residential property (i.e. for failure to include the required warning wording).

Change to definition of buyer of residential property

A buyer will be excluded from the operation of the new legislation in any of the following circumstances:
  • Purchase of residential property at auction
  • Purchase of residential property by a registered bidder at an auction by 5pm on the second clear business day after the property was passed in at auction
  • A contract arising from the exercise of an option, if the parties to the contract are the same as the parties to the option
  • Purchase by a buyer which is a publicly listed corporation or a subsidiary of the same
  • Purchase of residential property if the buyer is the state or a statutory body
  • Purchase by a buyer of at least three lots at the same time, whether or not in the same contract

Cooling-off periods

The cooling-off period will remain, as will the potential termination penalty for buyers wishing to exercise their rights to terminate during the cooling-off period.
However, the process to waive or shorten the cooling-off period will be simplified. Instead of a solicitor being required to fill out a prescribed form, buyers will be able to waive or shorten a cooling-off period by written notice to the seller.

Removal of commission cap

There will be no legislative cap on commissions that can be charged. Instead, the requirement will be that commission must be worked out on the actual sale price of the relevant property.
The new law retains certain elements of PAMDA, including:
  • Commission can only be recovered by a person or entity holding the relevant licence
  • Commission can only be recovered if a signed appointment is in place
  • If commission is received and the requirements of the new law are not met, the commission is potentially repayable
The new legislation is a timely reminder for real estate agents to check that they are complying with current PAMDA requirements, including in relation to the explanation required to be given if an agent is to be retained under a sole or exclusive agency and the requirement to provide a copy of fully signed appointment documentation within a certain timeframe. We note that non-compliance may result in fines being imposed on the real estate agent.

Removal of disclosure for vacant land

Agents will no longer be required to give particular notices to buyers for the sale of vacant land on which a residence cannot lawfully be constructed. Under PAMDA, if this notice is not given, a buyer has termination rights.

Removal of licensing requirement for directors of property developers

The need for directors of property developers to hold licences will be removed. However, a licensed real estate agent will be required to be in charge of a real estate agent business.
Property developers involved in the direct sale of property will be required to disclose to buyers any expected benefit to the property developer from a referring party connected to the sale.

Sophisticated parties and residential property transactions

There are exemptions from the legislation where the property transaction involves sophisticated parties.
Excluding residential and rural land, agents are exempt from compliance with the new legislation in either of these circumstances:
  • The property has a total gross floor area or estimated value to be set by a future regulation
  • Each party to a transaction owns property (apart from the property the subject of the transaction) having a total gross floor area or estimated value to be set by a future regulation

Commencement date of legislation yet to be announced

We note that the date for the new legislation to commence has not yet been set. We will issue a further alert once the commencement date and details of any transitional periods that may apply are known.
Oliver Meehan Rhett Oliver
Property acquisition, development and sale
CBP Lawyers

Tuesday, 20 May 2014

NSW Vale fires 500 coal miners in Australia, shuts down operations

Vale fires 500 coal miners in Australia, shuts down operations

Cecilia Jamasmie | May 16, 2014

Vale fires 500 coal miners in Australia, shuts down operations
Vale operations in Australia, courtesy of Integra.
Brazil’s Vale (NYSE:VALE) confirmed Friday it is closing its Integra Mine Complex in Australia, as the coal operation is not economically feasible under current market conditions.
The affected mines are the underground Glennies Creek and the Camberwell open cut, operated by subsidiary Integra in NSW Hunter Valley.
According to Newcastle Herald, employees were told that while operations would be shut down, facilities would be maintained.
In a brief statement (in Portuguese) Vale said its joint venture partners at Integra Coal mine unanimously supported the decision.
Peter Jordan of the Construction Forestry Mining and Energy Union told ABC the news came as a shock, adding the mine closure will have a huge economic impact.
"We're talking all up about 500 jobs there, so that's going to have a massive impact on the Singleton and surrounding towns where most of those workers and their families live," he was quoted as saying.
Coal prices have fallen by at least 30% in the past two years, forcing miners to take drastic measures.
Coal prices have fallen by at least 30% in the past two years, forcing miners to take drastic measures.
In March, mining and commodity trader giant Glencore Xstrata (LON:GLEN) said it will close its Ravensworth underground coal mine, also in Australia’s Hunter Valley, in September this year, citing falling prices and stock surplus as main reasons.
BHP Billiton, which through its partnership with Mitsubishi Corp. is the world's largest coking-coal exporter, has also closed several mines recently, including its Norwich Park and Gregory operations in eastern Australia because of weak prices.
Vale fires 500 coal miners in Australia, shuts down operations
The Australian economy is highly dependent on the black rock: coal is Australia's second-biggest export commodity and the industry is one of the country's largest employers.
 Cover image by Daniel M. Silva/

Rap up what the experts say will happen with Property Investors with the 2014 budget

Federal Budget 2014: Homeowners and the property sector winners

HOMEOWNERS dodged a bullet in this year’s Budget, with multi-billion tax breaks failing to come under scrutiny.
Historically, real estate is a minor player during federal Budgets, with the industry managed more tightly under macro rather than micro positioning.
But as the magnitude of Joe Hockey’s austerity Budget became clear, the housing sector looked to be one of the most obvious sectors to stem tax leaks.
Among the potential pain points, there were fears the family home would be included in means testing for the aged pension, and that negative gearing would come under scrutiny.
With cost-cutting front and centre of Joe Hockey’s tough reforms, the $6 billion a year in lost tax revenue from negative gearing could have been a significant boost to Government coffers.
But projections in the Budget of rising unemployment may have kept property out of the firing line, at least for now.
All governments understand that joblessness poses a real threat to the property sector, reducing mortgage holders ability to service loans and bumping up defaults. An unemployment fallout doesn’t discriminate between first-home buyer belts and prestige property postcodes.
With negative gearing intact, investors can breathe a sigh of relief. But for how long?
The tax perk does little to boost housing supply and locks out potential buyers who are unable to compete with investors, so it deserves to come under the microscope.
Financial commentator David Koch says negative gearing is a perennial Budget consideration but the time is probably nigh when its rules will change.
“Given negative gearing doesn’t appear to be stimulating much in the way of new housing investment — the original intention — and we’re approaching the peak of a property boom, the timing of a change in future concessions is probably right,” Koch said earlier this month.
There were no direct hits on the family home in this Budget either.
The CGT tax-free status for owner-occupier homes remained untouched, and more significantly the family home was excluded in pension means testing.
The Commission of Audit had proposed to include the family home in the assets test from 2027-28, but tonight’s Budget statement was succinct; ‘The Government will not include the family home in the means test for the Age Pension’.
BRW property rich-lister Kevin Young said fears of its introduction had made buyers skittish in the Budget lead up.
“Some buyers still aren’t convinced this type of means testing won't be introduced. down the track. A couple I know are so frightened by it, they recently bought a home in Bali rather than Australia,” Young said.
He said a sell-off of family homes, investing in exempt assets classes, and local buyers switching to offshore real estate were just a few of the likely outcomes had it been an inclusion tonight.
The Budget predicts a surge in construction, so more stock coming onto the market may sof
The Budget predicts a surge in construction, so more stock coming onto the market will improve affordability. Source: Supplied

First-home buyers saving for a deposit have lost an incentive with the scrapping of the First Home Savers Account (FHSA) in the Budget.
The Rudd government initiative, introduced in 2008, provided people saving for a deposit with tax breaks and co-contributions from the government.
Under the scheme, savers paid concessional tax rates of 15 percent on interest earned in the accounts and the government made a 17 percent co-contribution on the first $6000 contributed each year.
The government co-contributions to the accounts will end on July 1 and tax and social security concessions will be withdrawn from July 2015.
Mr Hockey said the accounts were being abolished because their low popularity.
The Government expects to make $143 million in savings over five years from its scrapping.
Property’s peak national body the REIA had called on the Government toreview the amount of the First Home Owner Grant annually to maintain relativity with house price movements, but in this tough Budget that was unlikely to be a priority.
What’s more, the Government strongly outlined tonight that it expects interest rates to remain low in the medium to long term, creating less need for its intervention to boost housing activity.
The Budget also predicts a surge in construction, so more stock coming onto the market will improve affordability.
“The housing sector is beginning to respond to lower interest rates with a pick-up in prices and leading indicators of construction,” it said.
“These developments have contributed to an improved outlook for the household sector.”
Consumer reaction to the Budget will have an immediate impact on buying and seller activity, becoming apparent within weeks through auction attendance levels and clearance rates.
As the Government’s cost cutting flows through to household sentiment and the overall economy, the need for the central bank to tighten its macro policy will become less likely.

So at the very least, this Budget presents an upside for mortgage holders with its austerity keeping rates lower longer.

We were warned it was to going be the budget from hell but last night Federal Treasurer Joe Hockey declined to play the part of Godzilla – deciding to cut spending a little now and much more in the future.
Nonetheless, with headline numbers like an $80 billion reduction in government spending over the next decade, many are asking what impact the budget will have on property buyers and the market.
What impact the budget will have on property buyers and the market?

The economy

Ask any real estate agent and they will tell you that the overall economy has a big influence on the health of the property market.
While some feared a savage tightening, Hockey has restricted cuts to government spending to just 1.7% in 2014-15, with most of the pain shuffled to the ‘out years’ starting in 2016-17.
Economic growth is forecast at 2.5% next year, with unemployment rising from 5.8% now to 6.25% in 2015.
16,500 public servants will go mostly through natural attrition – a result unlikely to please anyone with an interest in ACT property.
Most of the pain will be in the health and education sectors but the heavy lifting has been shifted to the states, starting in 2017. So expect to see some tougher decisions closer to home later on – and perhaps a rise in the GST.


Families are the largest buyers of real estate in Australia, particularly in the middle and outer-ring suburbs of large cities and regional areas like south east Queensland.
Their spending power will be crimped a little with family tax benefit increases frozen from this year and FTB-B gradually restricted to households earning $100,000 per year.

The property industry

The new government foreshadowed that assistance to industry would be wound back and that’s exactly what they did – and the property sector was no exception.
The slow starting National Rental Affordability Scheme, designed to help build new homes for low and moderate income earners, has been frozen pending a review, and First Home Saver Accounts have been abolished along with a pilot scheme for seniors wanting to downsize their home.
Read more: What is the National Rental Affordability Scheme
The budget forecasts growth in private investment in housing at 7.5% next year, which seems a pretty optimistic number given it is more than double this year’s growth.
For Australia’s 1.9 million property investors, the budget brings a big sigh of relief – negative gearing survives intact.
Read more: How negative gearing works


Just as we predicted last September, road spending has been a big winner with multi-billion projects scheduled to proceed right around the country.
The most important of these include:
  • a North-South arterial road in Adelaide
  • WestConnex in Sydney
  • the East-West Link in Melbourne
  • a long overdue upgrade of the Bruce Highway in Queensland
  • a new bypass in Toowoomba.
road, Perth
But wait, there’s more. Thanks to the ‘infrastructure asset recycling program’, state governments will receive a subsidy equivalent to 15% of an asset sale if they plough the money back into new infrastructure.


There’s a final rub to the forecasting and future gazing, thanks to the Australian constitution.
Some of the measures announced last night  cannot be attached to the appropriation bills, which means that to take effect they must be approved by both houses of parliament in their own right.
Three of the most contentious – the paid parental leave scheme, the increase in petrol excise and the so-called deficit levy on high income earners – have already attracted public opposition from some of the Senators needed to pass them.
In other words, while we have a budget printed on paper, its final form hasn’t been settled yet – and there is plenty of politics still to come.

A Property Investor’s Guide To The Federal Budget

Michael Yardney About Michael Yardney
Michael is a director of Metropole Property Strategists who create wealth for their clients through independent, unbiased property advice and advocacy. He has been voted Australia's leading property investment adviser and his opinions are regularly featured in the media. Visit
There’s been lot’s of commentary about the budget in the last few days.

One of the best summaries comes from the Property Council of Australia who said:

The Abbott Government’s first budget outlines an economic blueprint to restore the nation’s finances to the black and invest in growth, underpinned by a $50 billion investment in infrastructure – including $11.6 billion for newly announced projects.
The Budget includes a series of cuts targeting welfare, health and industry assistance designed to return the budget to a surplus of $1 billion by FY2018.
It also introduces a two percent temporary ‘Debt Levy’ on personal income tax for individuals earning more than $180,000 per annum. The Government says temporary measure will be repealed from 1 July 2017.

The property industry is not exempt from the budget pain.

The Budget announces:
  • ending the National Rental Affordability Scheme (NRAS);
  • new pilfering of industry funds held in the Australian Reinsurance Pool Corporation; and,
  • scrapping of the Housing Help for Seniors program.
The cuts are offset by some promising initiatives, particularly in the infrastructure arena. These include:
  • Infrastructure Growth Package – delivering $11.6 billion of previously unannounced transport infrastructure;
  • an Asset Recycling Initiative – providing a 15 percent incentive for states and territories to offload assets to fund new infrastructure; and,
  • confirmation of key election commitments such as the $2.55 billion Emissions Reduction Fund, and a 1.5 percent reduction in the company tax rate.
The Budget is the first of the Abbott Government’s major reform statements.
More comprehensive reform is slated for tax modernisation and federal-state relations.

Infrastructure, strategic planning and growth

Infrastructure Growth Package
  • The centrepiece of the budget is the Infrastructure Growth Package which builds on the previously announced $39 billion Infrastructure Investment Plan.
  • $11.6 billion of new spending is allocated to transport infrastructure in the budget.
  • Major new investments include: acceleration of Melbourne’s East West Link; Adelaide’s North South Corridor; the Perth Freight Link; Toowoomba Second Range Crossing; and Western Sydney road upgrades to support Badgerys Creek.
  • Details of all projects slated for funding can be found at the Treasury website
Asset Recycling Initiative
  • $5 billion from the Infrastructure Growth Package will be allocated to the Infrastructure Recycling Initiative – aimed at incentivising asset sales by states and territories.
  • This program will be underpinned by a new National Partnership Agreement.
  • States and Territories will receive an incentive equal to 15 percent of the price of all public assets they divest.
Asset Recycling Fund
  • An ongoing Asset Recycling Fund will be established at the Commonwealth level.
  • This will be capitalised using remaining money from the Building Australia Fund and Education Investment Fund, with further contributions following the sale of Medibank Private.

Housing, retirement living and liveability

National Rental Affordability Scheme to be discontinued
  • The final round (Round 5) of the National Rental Affordability Scheme (NRAS) will not proceed – saving $235.2 million over three years.
  • Uncontracted funding from earlier rounds – or contracted funding that hasn’t been used within agreed timeframes – will be returned to consolidated revenue.
  • Funding for tenanted NRAS properties will not be impacted.
Housing Help for Seniors Programme – scrapped
  • Government will not proceed with the Housing Help for Seniors pilot program.
  • The program was introduced in last year’s budget to assist seniors downsize to age-appropriate housing.
  • A saving of $173.1 million over five years has been booked.
Taxation of retirement village loan liabilities
  • The Federal Government has confirmed it will carve out retirement village residential loan liabilities from tax consolidation changes announced in last year’s budget.
  • The original proposal threatened to tax retirement village income twice, where the ownership of a village changes due to a company acquisition.
  • The carve out will ensure retirement village operators are not subject to double taxation when a retirement village is acquired by a consolidated group.
  • This win is a direct result of Property Council advocacy. Taxation and public finance.
Company tax rate – 1.5% reduction from 1 July 2015
  • The Federal Government remains committed to cutting the corporate tax rate by 1.5% from 1 July 2015.
  • For large companies, the reduction will offset the cost of the Government’s proposed Paid Parental Leave levy, also to be introduced from 1 July 2015.
Foreign resident capital gains tax amendments extended
  • The former Government announced it would amend the capital gains tax rules to exclude intercompany dealings between members of the same tax consolidated group – this was relevant to determining whether an entity passes the “land rich” test.
  • The “land rich” test ensures assets are not inappropriately double counted.
  • It is good news that the proposal will now be extended to exclude intercompany dealings between members of unconsolidated groups.
Temporary Budget Repair Levy for personal income > $180,000 p.a.
  • The Federal Government will impose a 2% levy on individuals with taxable incomes above $180,000 per annum.
  • The levy will apply for three years, from 1 July 2014 to 30 June 2017, and raise $3.1 billion.
  • To prevent high income earners from utilising fringe benefits to avoid the levy, the FBT rate will be increased from 47% to 49% for the period 1 April 2015 to 31 March 2017.

Capital Markets, Finance & Liquidity.

MIT reforms – deferred to 1 July 2015
  • The Federal Government will defer the start date of the proposed MIT reforms by 12 months to 1 July 2015.
  • The purpose of the MIT reforms is to codify industry practice, provide certainty for the market and slash red tape.
  • The deferred start date will provide Government and industry additional time to consult on the measures and make the necessary administrative changes to implement the reforms.
Superannuation guarantee to increase to 9.5% on 1 July 2014
  • The Federal Government has confirmed that the superannuation guarantee rate will increase to 9.5% on 1 July 2014.
  • The superannuation guarantee rate will remain at 9.5% until 30 June 2018, after which it will increase by 0.5% each year until it reaches 12% in FY2023.

Eco-efficiency, climate change and resilience

Direct Action (the Emissions Reduction Fund)
  • The funding commitment of $2.55 billion for the Emissions Reduction Fund has been confirmed in the Federal Budget.
  • The Clean Energy Regulator and Department of the Environment will administer the scheme using existing resources.
National Climate Change Adaptation Research Facility (NCCARF)
  • The Budget confirms the Coalition’s election commitment to fund NCCARF for a further three years.
  • NCCARF will receive $9 million up to FY2017.

Governing smarter and efficient regulation

Reduced funding for corporate regulatory and tax administration bodies
  • The Government will cut funding for the Australian Securities and Investments Commission (ASIC) and the Australian Taxation Office (ATO) by $262.9 million over five years.
  • The Government will also conduct a review into the potential privatisation of ASIC’s registry function.
Tax compliance and data matching – deferred to 1 July 2016
  • Government will defer the commencement of its proposed third party reporting and data matching regime to provide further time to consult on the measures.
  • Unless amended, the proposed reporting regime will lead to the same information being unnecessarily collected by government agencies and businesses, duplicating time and costs.

Workforce, skills, industry productivity, innovation and security

Australian Reinsurance Pool Corporation
  • The Australian Reinsurance Pool Corporation (ARPC) – a government agency funded by the property industry to underwrite terrorism insurance – will be milked to the tune of $450 million over the coming four years.
  • This continues Labor’s malpractice of syphoning industry funds to plug budget holes. This reduces Australia’s preparedness for terrorist attacks.
  • Astoundingly, further $1.2 million will be allocated to a study looking at the role of the ARPC into the future.
Australian Building and Construction Commission
  • The budget provides $34 million for the coming year to fund a much needed boost to the capacity of the Australian Building and Construction Commission (ABCC).
  • This delivers on a key election commitment to enable this cop on the beat to stamp out illegal union activity on construction sites.
Royal Commission into Trade Union Governance and Corruption
  • The budget allocates $53.3 million to the Royal Commission into Trade Union Governance and Corruption.
  • The Royal Commission will look closely at the conduct of trade unions in the building and construction industry.
  • The Royal Commission is scheduled to report by 31 December 2014.  

What the Budget means for your investment property

Posted on Wednesday, May 14 2014 at 12:19 PM
Do you currently own a blue-chip apartment or a three-bedroom pad in the suburbs? You can breathe a sigh of relief – negative gearing wasn’t axed in the latest Federal Budget.
Homeowners planning to sell their principal place of residence also won’t have to pay capital gains tax (CGT). At the moment, if an investor sells an investment property, CGT is calculated. But the family home is the only property exempt from this tax and will remain so for the foreseeable future.
Another huge win for investors is the fact that interest rates are likely to remain low for some time, with inflation forecast to hold steady at 2.5 per cent for the next few years.
Steve McKnight of Property Investing says it’s hard to see where the pressure for significant interest rate increases will come from.
“Real estate investors have good cause to believe that home loan interest rates will be stable at current historical lows for some time yet,” he says.
Investors trying to enter the booming Sydney and Melbourne markets, and other capital cities for that matter, might also find prices start to stabilise.
McKnight believes the Budget will probably lead to a dip in consumer confidence and less spending in the short-term.
“As such, this will put something of a wet blanket on the property market until at least spring,” he says.
“The biggest impact is going to be in Canberra (where there will be job cuts to public servants.) ACT homeowners and investors need to consider their property positions and take corrective action now.”
However, investors thinking about purchasing a National Rental Affordability Scheme (NRAS) property down the track will have to choose another option. That’s because the government will be discontinuing round five of the NRAS Scheme, saving $235.2 million over three years.
“Since its establishment in 2008, NRAS has delivered 14,575 new homes for low and moderate income households and was on track to provide 23,8884 more,” Urban Development Institute of Australia national president Cameron Shephard says.
The scheme will remain in place for investors who already own NRAS property and funding for properties already tenanted won’t be impacted. However, uncontracted funding from earlier rounds, or contracted funding that hasn’t been used within agreed timeframes, will be returned to consolidated revenue.
Shephard admits NRAS became too bureaucratic and administrative but he believes there would have been other solutions, rather than scrapping the program.
“They’ve thrown the baby out with the bath water,” he says.
“We suggested to keep the scheme but make it more efficient. Now the Federal Government is walking away from any sort of public housing and we think that’s wrong.”
The government has also ditched the Housing Help for Seniors program. The program was introduced in last year’s budget, to assist seniors who wish to downsize their home. The axed program saves $173.1 million over five years.
Executive Director of the Retirement Living Council Mary Wood says it’s disappointing.
“Senior Australians should be allowed to choose homes that allow them to age in place, but the scrapping of the Housing Help for Seniors creates less housing choice and puts more pressure on residential aged care and the taxpayer,” she says.
“However, we congratulate the Federal Government on a positive initiative that will no longer subject retirement village operators to double taxation if ownership of a village changes because of a company acquisition.”
The First Owners Saver Accounts, which helped first homebuyers save for their first home, was another scheme scrapped by the government.
But investors keen to use a Self-Managed Super Fund (SMSF) down the track to purchase an investment property might soon have more funds to do so.
There will be an immediate increase in the superannuation rate from 9.25 per cent to 9.5 per cent, from July 1 this year. It will increase by 0.5 per cent until it reaches 12 per cent in 2022-23.

Real estate associations and economists sit on different sides of the fence on the rumours the government will reform Australia’s negative gearing rules in the 2014 Budget.

There have been reports the government will amend the controversial rules, by grandfathering arrangements for existing investors and only allowing negative gearing on newly constructed dwellings.

Both the Housing Industry Association and the Real Estate Institute of Australia (REIA) believe any change to negative gearing would impact on the supply of housing and the level of rents in an already tight rental market.

“To amend the current negative gearing provisions for housing would be treating real estate differently to other asset classes, create a distortion on the investment landscape and result in a resource misallocation,” REIA president Peter Bushby said.

“The view that negative gearing is for wealthy investors is a myth. ATO data shows fewer than 80% of the total individual taxpayers that are claiming a tax deduction for property earn less than $80,000 a year.”

He believes a change to negative gearing could result in rents rising by more than 4%.

RP Data’s Cameron Kusher said negative gearing is in place to encourage developers to build new rental accommodation and private individuals to act as landlord for those who are not in a position to own their own home.

“While it would make sense to apply negative gearing only to newly constructed properties, politically it would likely be unpopular. Furthermore, if negative gearing was to be removed the government would likely have to play more of a role in constructing new homes and managing a portfolio of properties.

“On balance, they probably see that foregoing almost $8 billion in taxation revenue is more cost effective than developing and managing a greater proportion of new housing stock,” Kusher said.

But according to Grattan Institute research, quarantining negative gearing losses would save the budget around $4 billion per year initially and fall to a saving of around $2 billion per year over the longer term.

Its report also showed that negative gearing was not producing much-needed new affordable housing.

Economist Leith van Onselen has argued many times on his blog against retaining negative gearing, especially on the grounds of rental supply.

“A large scale sell-off by investors would be met by purchases from renters (i.e. first home buyers). In turn, those renters would be turned into owner-occupiers, reducing the demand for rental properties and leaving the rental supply-demand balance unchanged,” he said.

Property Asset Planning managing director Brian Chant would also support changes to end negative gearing on established property and allow it only for new dwellings.                 

Monday, 19 May 2014

BAN TACS Accountants Pty Ltd Newsflash Thinking Of Putting A Lump Sum Into Superannuation?

BAN TACS Accountants Pty Ltd Newsflash Thinking Of Putting A Lump Sum Into Superannuation?
The ultimate tax minimisation strategy for retirement is having your money in a super fund that is in pension stage so it pays no tax on its earnings and you pay no tax when you draw the money out. There are restrictions on how much you can put into superannuation so you need to start planning. You are allowed to put $150,000 in the 2013/14 year if you are under 65 years of age. 

You will not get a tax deduction for this amount and it will not be taxed going into the superannuation fund. If you want to contribute more than this and you did not put more than $150,000 in each of the last two years then you are entitled to pull back the next two year’s allowance.

This means that if you are under 65 years of age at any time during the 2013/2014 financial year you can put up to $450,000 in this year. Or if you need to put more than this in and you won’t be over 65 by 30th June, 2014 then you could just put $150,000 in this year and on 1st July use up the 2014/2015 threshold and draw back the next two years after that. In the 2014/2015 financial year the threshold will go from $150,000 to $180,000. 
So if you do it all this year you will only be able to put $450,000 in and nothing for the next two years, not even the $30,000 a year you missed out on. If you just put $150,000 in this year you will be able to put in $540,000 ($180,000 x 3) in the 2014/2015 year, a total of $690,000 over the next few months but then nothing again until 2017/2018.
If you are over 65 years of age the rules are a bit different. First you must satisfy a work test of at least 40 hours in a 30 day period in the year you make the contribution and you are not entitled to pull back from future years. 
If you are under 65 years of age at any time during the 2013/14 year you are still entitled to draw back the two years. So if you turn 65 during the 2013/2014 financial year you have to choose between putting $450,000 now and not being able to put any more in until the 1st July, 2016 and then still needing to satisfy the work test or continuing to work until you have done 40 hours in July 2015 and putting $150,000 in in 2013/2014, $180,000 in 2014/2015 and $180,000 in $2015/2016. Fortunately, if you don’t have that much you don’t have as much to worry about and may even be able to retire sooner. 

For $69.95 at Ask BAN TACS you can have your questions regarding Capital Gains Tax, Rental Properties and Work Related Expenses answered by Julia. I will include ATO references to support our conclusion, answer are generally 300 to 700 words long depending on the complexity.
Disclaimer: Please note in many cases the legislation referred to above has only just passed through parliament. The full effect is not c lear yet but it is already necessary to make you aware of the ramifications despite the limited commentary available. On the other side of the coin by the time you read this information it may be out of date. The information is presented in summary form and intended only to draw your attention to issues you should further discuss with your accountant. Please do not act on this information without further consultation. We disclaim any responsibility for actions taken on the above without further advice as to your particular circumstances. 

Sunday, 18 May 2014 2014 Budget Summary 2014 Budget Summary
I remember something in the press about the LNP doubling the deficit to suite their sky is falling agenda, “new ways of measuring things” Anyway I find that interesting considering they are claiming the budget as a success because it will take the deficit from $49.9Bil to $29.8bil. 

Does this mean that by the old measurement rules they have actually increased the deficit?
Deficit Levy
A three year temporary levy of 2% will be imposed on individuals’ taxable income in excess of $180,000 pa, from 1 July 2014 until 30 June 2017. Note that is only 2% on the amount over $180,000.. 

this means high income earners should delay expenses this year and pull forward income if they can, though for 2%, it might not be worth their effort, definitely not worth running around trying to get tax deductions before 30th June.

Other laws that are based on the maximum tax rate will take the levy into account but with the FBT rate it will not consider whether the person receiving the benefit is on $180,000 or $20,000 this rate will increase to 49% regardless so it is even more important than ever to make sure you cancel out the FBT by making employee contributions even if you have to give the employee a pay rise to cover it.

Help & Hecs Debts From 1st July 2016 these loans will start to be repaid once income exceeds $50,638 but only at a rate of 2%. The standard 4% will apply to income above $56,264. The big incentive to repay as soon as possible is that instead of increasing the balance owing by just CPI it will now be the bond rate which could be up to 6% so generally it would be better to repay your debt than keep money in a savings account, which has not been the case in the past.

Youth Allowance
From 1st January 2015 Parents will have to support their children until they are 24 previously it was 22.
Current recipients will continue to qualify but the income thresholds will be frozen for 3 years.
Family Payments

From 1st July, 2015 families where the primary income earner earns more than $100,000 will no longer qualify for part B payment. 
Further, Part B payments will be limited to families whose youngest child is younger than six years of age. A transitional arrangement will ensure families with a youngest child aged six and over on 30 June 2015 remain eligible for the payments for two years. 
For sole parents where their youngest child is between 6 and 12 years, they will receive just $750 a year (a reduction of $2,268.55 a year.

Pension eligibility age by date of birth:
BAN TACS Accountants Pty Ltd Newsflash
for sole parents and a reduction of $3,018.55 a year for two parent families) instead of the Part B but only if they qualify for the maximum payment of Part A, nothing for two parent families. Previously sole parent families would have received Part B regardless of income.

Part A and Part B amounts paid will be frozen for the next 2 years. The income thresholds will be
frozen for 3 years except of course the reduction of the income test for the primary income earner in a
family, from $100,000 to $150,000 for Part B, the payment that helps support a parent to stay home with their children. A boom for the child care industry, oh hang on a minute that is under supplied anyway and receiving much more in subsidies per child than Part B? Did they factor after school care into the budget forecasts?
Further, the income threshold for Part A will effectively be reduced from 1st July, 2015 because there will be no allowance for the number of children in the family. The large family allowance has been reduce to only be payable for the fourth and subsequent children from 1st July, 2015. All a little slight of hand, that is going to affect the most in need more than most taxpayers

From 1st July, 2015 the end of year supplements will be reduced to $600 for each Part A child and $300 for each family that is entitled receive Part B (now only children under 6 or sole parents with a child under 12)
Workers over 50
From 1 July 2014, a payment of up to $10,000 will be available to employers who hire a mature aged job seeker, aged 50 years or over who has been receiving income support for at least six months.
Pension Age
A jump straight from 65 to 70 for the age pension by 1st July 2035.
The following table sets out the Age
Date of birth between
Age at which eligible for Age Pension
1 July 1952 and 31 December 1953
1 January 1954 and 30 June 1955
1 July 1955 and 31 December 1956
1 January 1957 and 30 June 1958
1 July 1958 and 31 December 1959
1 January 1960 and 30 June 1961
1 July 1961 and 31 December 1962
1 January 1963 and 30 June 1964
1 July 1964 and 31 December 1965
1 January 1966 and later
The government will change how it deems the investment return from a person's financial assets for the purposes of the pension income test. The deeming thresholds will be reset from $46,600 to $30,000 for single pensioners and from $77,400 to $50,000 for pensioner couples from 1 September 2017. 
That is you will be expected to earn a higher rate of return on income above these amounts regardless of whether you do or not. 
These thresholds will not increase for 3 years.

From 1 September 2017, pension increases will be linked only to the Consumer Price Index (CPI) not
average earnings Payments of the Senior Supplement will also cease after the June 2014 payment. 

This was worth $876.20 per year for singles and $660.40 for each member of a couple.
The pensioner education supplement will be abolished from 1st January, 2015.

Medicare System
The Medicare levy surcharge income threshold and private health insurance rebate income threshold
will be frozen for 3 years from 1st July, 2015
From 1st July, 2015 despite the medical profession coming to the party and bulk billing in many cases so there is no patient cost even though the Medicare payment did not keeping pace with fee increases. The government still has to flog this horse even harder. 

I wonder did they factor into the forecasts the social security payments saved by people dying due to a bad choice between food and a doctor’s visit. Yes on $36 per day that is the choice. 

The charge will be $5 to $7 on any doctor’s visit and on any out of hospital tests that the doctor recommends. The concession for these people on the poverty line is that after they have paid for 10 of these in a year they do not have to pay any more.
Further the restriction on hospitals preventing them charging for emergency room services, will be


Funding for new projects will stop but currently tenanted properties and those under construction that
meet deadlines will continue to receive all the incentives.

The superannuation guarantee rate will now increase to 9.5% on 1 July 2014 and remain at 9.5% until 30 June 2018. The rate will then increase by half a percent each year until it reaches 12% in 2022/23.
Small Business Depreciation Rates

The budget was silent on the Abbott government proposal, from 1st January, 2014 to remove the $5,000 outright deduction on motor vehicles (then 15% depreciation on the balance) and the immediate write off of equipment purchases under $6,500 (includes motor vehicles) created by the previous Labour government.

The repeal legislation did not get through the senate but the government has not given up on the proposal as it is part of removing the mining tax. This means that the law could be changed retrospectively in July, 2014; leaving business with no idea how to complete their tax returns let alone any chance of the incentive actually creating the increased spending by business that it was intended to generate. 

All that will happen is businesses that would have spent the money anyway will be the only ones to benefit from the incentive if it is not clawed back, completely missing the point.

More Uncertainty:
Other issues left in limbo because he budget paper was silent on them yet the government is not backing down on trying to get them through the senate. Many of which need answers before 30th June
The company loss-carry back provisions 
The repeal the low income superannuation contribution the contribution would be not payable in
respect of concessional contributions made after 1 July 2013; so what do low income earners do at
30th June this year?
repeal the income support bonus;
repeal the schoolkids bonus;
While the reduction in the company tax rate to 28.5% was mentioned by Joe Hockey it was not included in the budget calculation so is far for certain. 

For $69.95 at Ask BAN TACS you can have your questions regarding Capital Gains Tax, Rental Properties and Work Related Expenses answered by Julia. I will include ATO references to support our conclusion, answer are generally 300 to 700 words long depending on the complexity.
Disclaimer: Please note in many cases the legislation referred to above has only just passed through parliament. The full effect is not c lear yet but it is already necessary to make you aware of the ramifications despite the limited commentary available. On the other side of the coin by the time you read this information it may be out of date. The information is presented in summary form and intended only to draw your attention to issues you should further discuss with your accountant. Please do not act on this information without further consultation. We disclaim any responsibility for actions taken on the above without further advice as to your particular circumstances.