FormulaNova said..

Yeah, muscle cars. Or even collectable cars, but who thinks that even average cars are going to appreciate when you own them. When they are old, they are rubbish and need lots of work. It's only 30 years later that they are worth something if they survive and you have a pandemic at the same time. Old cars are so much work and at least to me, they are still old cars.

You got a few thousand back each year on your tax? I must be the only person that would normally get almost nothing as generally my employers paid me the correct amount and the correct amount of tax on that. A few thousand back is impressive. Was it from work deductions or negative gearing?

The guy I was mentioning before that had 12 investment properties back in about 2004 had one of those agreements with the tax office where due to a obvious reduction in tax at the end of the year, you can get that brought forward and pay less tax upfront instead. It certainly improves your cash flow.

Your example seems decent. $500k after 20 years sounds okay. Did you need to put a lot of work in, or was it set and forget, just paying the loans?

I think all this stuff amplified around the mid 2000s as speculation increased and the capital gains discount kicked in. Negative gearing was certainly a thing before 2000, but no one seemed to snap up property like they do now.

remery said..
I bought a couple of properties in the "welfare belt" on interest only loans. As a PAYG worker, I don't remember any great benefit from negative gearing. I'm pretty sure my tax return was only a few thousand each year... like many full time employees. I made maybe $500k after 20 years and had to pay of the loans and then pay capital gains tax on half that. I reckon I should have invested in muscle cars.

Edit: I should have added that the only reason the bank gave me a couple of loans was that I out the family home up as collateral.

myscreenname said..

Not sure how much you paid for them, but I'd assume they went up at least 4x. If I do the maths that's roughly between $15 - 20k per year profit for 20 years. With hindsight everyone can do better, but that risk paid off.

FormulaNova said..




Nope. Unless there are industry specific deductions, and a lot of them to account for 3k, most people should be getting next to no deductions if their PAYG is calculated correctly. The tax tables are pretty clear how much to deduct, so its hard to get it wrong.

But like all things in tax, anything goes, until you get audited. My boring anecdote to this was a work colleague that had the masterplan of renting one level of his house to his business and then deducting the cost of half of his mortgage against his business. I and a few other colleagues pointed out that the income from the business to his personal account should then be taxed.... but unless he got audited, he would have gotten away with it.

Pcdefender said..
Check out from 5-30 the cost of grapes and coke at WW.

D3 said..
You're complaining about the cost of grapes, in Perth, in Winter?

Pcdefender said..


Even in winter they were never anything like 25 dollars a kilo.

D3 said..
Has PC considered why he can even buy grapes now?

Wasn't that long ago that grapes were really only available during Summer and Autumn unless they were imported/transported long distances.

But somehow table grapes are available well outside of their historical season.
Hmmm... why is that?

Carantoc said..





2000 years ago the Romans grew grapes in the north of England.

Doubt they sold them at either Woolies or Spudshed though.

D3 said..
Has PC considered why he can even buy grapes now?

Wasn't that long ago that grapes were really only available during Summer and Autumn unless they were imported/transported long distances.

But somehow table grapes are available well outside of their historical season.
Hmmm... why is that?

remery said..
Wait until you see the grain production estimates for WA this year. (spoiler, less than half of 2023)