Property tax and CGT estimates
Why can property cash, taxable income, capital gains and income-tax estimates differ?
Why can cash and taxable income differ?
Rent received and expenses paid affect cash. Deductibility, recorded depreciation, carried losses, legal-owner treatment and effective tax policy determine taxable income. PropRetire keeps cash, taxable income, assets, liabilities and carried losses separate. A cash movement is not taxable income unless the tax calculation treats it that way.
Estimated income tax liabilities and compulsory HELP repayments are shown as positive amounts. Their cash effects are negative because payment reduces cash. A taxable rental contribution is an input to taxable income, not tax payable.
Which date applies to a property sale?
A planned sale uses the projected property value on the contract date as capital proceeds. The contract date sets the CGT event and financial year and selects the applicable policy. The settlement date controls the sale cash, deduction of recorded debt traced to the property and removal of the property. Rent, expenses and debt continue until settlement.
What does the CGT estimate use?
The estimate uses the acquisition contract and cost, the selling costs saved with the property, recorded cost-base items, the cumulative Division 43 opening adjustment and covered annual Division 43 periods, legal ownership, property-use periods, confirmed main-residence treatment, available capital losses and the owner's applicable CGT treatment.
When a required classification, election or complete record is missing, PropRetire leaves the affected result unavailable rather than treating it as zero.
How does a capital gain affect the result?
A net capital gain enters the owner's taxable income and changes the complete income-tax estimate. PropRetire does not add CGT again as a separate cash charge. The property-sale tax bridge shows the estimated change in income tax and the estimated change in compulsory HELP separately.
What does the individual tax estimate cover?
PropRetire estimates individual tax only for a complete financial year with a full-year Australian-resident profile. It includes resident income tax, LITO, the Working Australians tax offset when it applies, the standard individual Medicare levy and its low-income phase-in, and compulsory HELP repayments where the required policy is available.
The estimate does not cover foreign or part-year residents, the Medicare levy surcharge, family and dependant Medicare levy thresholds, Medicare levy exemptions or reductions, or tax offsets other than LITO and the applicable Working Australians tax offset. Future HELP debt indexation is excluded until its rate is enacted. Company and SMSF tax, trust distributions and property CGT use separate calculation paths and remain estimates. Check the result with a registered tax agent.