Hi DDzxSorry, one more thing :)For it all to be legit the...

Hi DDzx

Sorry, one more thing :)

For it all to be legit the transaction (ie, rent) must be set at arm's length, so the rent, whilst, not having to be market value as such it must reflect a commercial nature.

For example, it the 'going rent ' would be say $250 but you only charge $200 cause you have a good tenant, you would still be o'k.

Again, in the old days some professions were notorious for playing with the rules on this whole thing. It was an absolute rort.

'Negative gearing ' has been going on since Adam was a boy on many classes of assets (well, Paul Keating stopped it for a while) but the tax treatment on the capital account(ie, selling) has changed since with the introduction of CGT and even a bit more with the 50% rule.

Whilst the capital treatment is not fair today IMO, it is a lot better than the old days.....it was a totally rorted system.

Nevertheless, the system 'rewards 'those that know the rules and can play them.

all the best