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Rental loses carryover

Newbie

Views 2754

Replies 11

Hi there,

I moved back to UK and rented my house here in Australia for 3 years at a considerable loss.

I came back to Australia in March, earned about $50,000 in wages for 2019 financial year and back living in the same house.

Can I claim those accumulated tax loses over three years against my wages? A tax accountant advised me that I cannot as my residency for tax purposes has changed, but it does not seem fair.

Thank you.

1 ACCEPTED SOLUTION

Accepted Solutions

Most helpful response

Devotee

Replies 9

Did you lodge tax returns in Australia while you were a non resident that showed you had a net loss to carry forward? These losses can be used against Australian sourced income and can be carried forward. As your $50,000 income is Australian sourced imcome I can’t see why you can’t use them? 

This is just my interpretation,  maybe someone else in the community will jump in and confirm. If I was you I would ask the agent to show you on the ATO website where they find that information or for them to double check. 

11 REPLIES 11

Most helpful response

Devotee

Replies 9

Did you lodge tax returns in Australia while you were a non resident that showed you had a net loss to carry forward? These losses can be used against Australian sourced income and can be carried forward. As your $50,000 income is Australian sourced imcome I can’t see why you can’t use them? 

This is just my interpretation,  maybe someone else in the community will jump in and confirm. If I was you I would ask the agent to show you on the ATO website where they find that information or for them to double check. 

Newbie

Replies 8

Thank you.

 

Former Community Support

Replies 7

Hi @gossss808,

 

Thanks for your patience whilst we checked information with a specialist area.

 

If you have incurred a net loss from your Australian located rental property while a non-resident of Australia, this means that when you lodge your tax return for that year you may have a tax loss that can be carried forward to future years. If you have made three years of tax losses from lodging tax returns while a non-resident, then these losses will be available to use to offset against any current year taxable income.

 

The main principle here is that, for any tax year, income and losses from Australian ‘sources’ (eg a rental property located in Australia) need to be declared by non-residents of Australia in a tax return-except where non-resident withholding tax has been charged (such as dividends and interest paid from Australian companies and financial institutions to non-residents of Australia), while residents of Australia must declare income from any ‘source’- whether from Australia or elsewhere- in their tax return. An assumption here is that you were a non-resident while you were away and that you became a resident again when you arrived back in Australia.

 

Hope this helps, JodieH.

Newbie

Replies 6

Hi JodiH

I made a rental tax loss last year due to not having an Australian income. I am Australian citizen but worked in NZ last year. Anyway, I am trying to bring forward rental tax losses from 2018-2019. In the online tool, I select “I had tax losses of earlier income year”. But when I go to “Add/Edit” section, there is no place to entre losses from rental property (this is not capital losses).

Can you please advise how it is done?

ATO Community Support

Replies 5

Hi @Jema

 

See Completing this section for a detailed step by step. However generally to personalise your return to show tax losses of earlier income years, at Personalise or Step 3 select:

    • You had tax losses of earlier income years

    To show your tax losses of earlier income years, at Prepare return or Step 4 select 'Add/Edit' at the Deductions, or tax losses of earlier income years banner.

If your still having a problem to find it use our Live Chat people they can guide you through and see your return in real time as well.

Newbie

Replies 2

Hi @MarkATO and thanks for the reply.

interestingly, under step 4 there is no "Add/Edit" option. it only says "tax losses from previous year not available". eventhough I did complete my tax return last year. do you why is that?

just to clarify, there is "Add/Edit" option next to items 1-3 which are not relevant to me but item 4 does not have it.

ATO Community Support

Replies 1

Thanks @Jema for the reply. Refresh and check what you selected at step 3 for without that the label does not generate. The label you are looking for at step 4 is Deductions, or tax losses of earlier income years. If the figure is not there (and you know the loss was in last years return) see if it allows you to add it manually. Our Live Chat folk may be useful if this is still not the outcome you are seeing.

Newbie

Replies 0

thanks @MarkATO 

I see the correct lable but no "Add/Edit" next to it. now that I know I have followed the right steps I'll try the live chat as the problem may be with the online tool. thanks agin.

Newbie

Replies 1

Hi @MarkATO 

I contacted Live chat in regards to "Add/Edit" option not showing next to "Tax Losses from earlier income year" banner. they say they can't help as they are not trained for that. they give me the 132861 number which I already called few times which they weren't able to help either.

Is there an email address so I can follow up this with the right people ?

given the deadline for tax lodgement is close, If i am unable to record my tax loss from 18-19, and if I only do my 19-20 taxes, can I claim 18-19 tax loss at a later date e.g. when I lodge my taxes next year?