taxable income comments

Hi all,

Some factors that should be taken into account when considering the possibility of a dividend from taxable income:

- Properties have been sold at most likely a loss in FY09. However, capital losses cannot be offset against assessable income. Capital losses are quarantined and carried forward indefinitely until offset by capital gains.

A bit like if your taxable income is $100,000 and you make a capital loss of $100,000 for the year, your taxable income will still be $100,000 as capital losses can only be offset against capital gains. However if your capital gains are $100,000 then your taable income will be $200k


- CSF was purchased by CER back in November 2007. Only 8 months of CSF income contributed to CER's overall taxable income figure in FY08 whereas 12 months of CSF income will contribute to CER's overall taxable income figure in FY09.

- LIBOR and 30 day BBSW and BBSY rates have decreased significantly in the last 12 months, reducing interest payments significantly and therefore increasing taxable income.

- Cashflow is irrelevant when calculating taxable income. Although Super operating cashflow and CSF operating cashflow have been quarantined (CSF no longer), profits derived from these two trust holdings will still add to the taxable income figure.


- I'm assuming that properties are being depreciated for taxation purposes at 2.5% per annum. The depreciaion should be higher in FY09 given CSF properties were acquired by CER in November 2007.

Overall, all things considering Im still tipping there will be taxable income for FY09 nothwithstanding any legal expenses and refinancing expenses it may have occurred within the last 12 months.

Cheers