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  Reply # 1133644 22-Sep-2014 13:37
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networkn:
itxtme:
networkn:
itxtme:
Geektastic: I believe smart people who make money deserve to keep it and the fact that some people cannot do that is unfortunate but irrelevant.


Interesting thought.  What about those who havent been educated on negative gearing, or dont have the ability to purchase property and avoid tax?  There is no doubt in anyones mind that the rich get richer by investing in ways that avoid tax revenue, not really sure how you think thats fair?

And you inferring that smart people dont get to keep their money is bizarr; they do get to keep it with a CGT,  they are just taxed on the gain...


Education is a choice. There are plenty of free ways to get educated on NG if that is your chosen poison.

I wouldn't say I am rich, but I won't get more "rich" using any method you have spoken of. I will get "richer" by continuing to educate myself, offer better service and or products than my competitor and working harder. It's how I got when I am now, and I started from very humble beginnings.

The people who you seem to be targeting, get more wealthy by using the tax code applied to the letter of the law, which was all set up a long time ago by people elected to do so. People who fall outside this get penalized. 


Huh!? You wont get more rich if you buy a house make a capital gain of $45,000 and dont pay tax on it?  NZ is one of a few OECD countries not using a CGT.  Private debt is out of control, if the housing bubble bursts there is going to be a lot of hurt, for a lot of people. Housing investment is a false economy that doesnt promote employment, and adds to a multitude of reasons that housing prices are so inflated.  Reform I say, reform!


If I buy a house and sell it and make $45K which I already did once, it will be for personal use and wouldn't be subject to CGT regardless. 

I am not a property developer and property developers pay tax on profits. 



IANATE / IANAL, but  that is only if it is the house you live in, so have purchased it for personal use, or something like a bach or weekender. But if you are buying a second house for an investment you would need to pay CGT from my understanding.

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  Reply # 1133645 22-Sep-2014 13:40
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mattwnz:
networkn:
itxtme:
networkn:
itxtme:
Geektastic: I believe smart people who make money deserve to keep it and the fact that some people cannot do that is unfortunate but irrelevant.


Interesting thought.  What about those who havent been educated on negative gearing, or dont have the ability to purchase property and avoid tax?  There is no doubt in anyones mind that the rich get richer by investing in ways that avoid tax revenue, not really sure how you think thats fair?

And you inferring that smart people dont get to keep their money is bizarr; they do get to keep it with a CGT,  they are just taxed on the gain...


Education is a choice. There are plenty of free ways to get educated on NG if that is your chosen poison.

I wouldn't say I am rich, but I won't get more "rich" using any method you have spoken of. I will get "richer" by continuing to educate myself, offer better service and or products than my competitor and working harder. It's how I got when I am now, and I started from very humble beginnings.

The people who you seem to be targeting, get more wealthy by using the tax code applied to the letter of the law, which was all set up a long time ago by people elected to do so. People who fall outside this get penalized. 


Huh!? You wont get more rich if you buy a house make a capital gain of $45,000 and dont pay tax on it?  NZ is one of a few OECD countries not using a CGT.  Private debt is out of control, if the housing bubble bursts there is going to be a lot of hurt, for a lot of people. Housing investment is a false economy that doesnt promote employment, and adds to a multitude of reasons that housing prices are so inflated.  Reform I say, reform!


If I buy a house and sell it and make $45K which I already did once, it will be for personal use and wouldn't be subject to CGT regardless. 

I am not a property developer and property developers pay tax on profits. 



IANATE / IANAL, but  that is only if it is the house you live in, so have purchased it for personal use, or something like a bach or weekender. But if you are buying a second house for an investment you would need to pay CGT from my understanding.


Well personally, I don't care about that, if it happens it happens, but it probably won't :) 


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  Reply # 1133681 22-Sep-2014 13:57
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networkn:
mattwnz:
networkn:
itxtme:
networkn:
itxtme:
Geektastic: I believe smart people who make money deserve to keep it and the fact that some people cannot do that is unfortunate but irrelevant.


Interesting thought.  What about those who havent been educated on negative gearing, or dont have the ability to purchase property and avoid tax?  There is no doubt in anyones mind that the rich get richer by investing in ways that avoid tax revenue, not really sure how you think thats fair?

And you inferring that smart people dont get to keep their money is bizarr; they do get to keep it with a CGT,  they are just taxed on the gain...


Education is a choice. There are plenty of free ways to get educated on NG if that is your chosen poison.

I wouldn't say I am rich, but I won't get more "rich" using any method you have spoken of. I will get "richer" by continuing to educate myself, offer better service and or products than my competitor and working harder. It's how I got when I am now, and I started from very humble beginnings.

The people who you seem to be targeting, get more wealthy by using the tax code applied to the letter of the law, which was all set up a long time ago by people elected to do so. People who fall outside this get penalized. 


Huh!? You wont get more rich if you buy a house make a capital gain of $45,000 and dont pay tax on it?  NZ is one of a few OECD countries not using a CGT.  Private debt is out of control, if the housing bubble bursts there is going to be a lot of hurt, for a lot of people. Housing investment is a false economy that doesnt promote employment, and adds to a multitude of reasons that housing prices are so inflated.  Reform I say, reform!


If I buy a house and sell it and make $45K which I already did once, it will be for personal use and wouldn't be subject to CGT regardless. 

I am not a property developer and property developers pay tax on profits. 



IANATE / IANAL, but  that is only if it is the house you live in, so have purchased it for personal use, or something like a bach or weekender. But if you are buying a second house for an investment you would need to pay CGT from my understanding.


Well personally, I don't care about that, if it happens it happens, but it probably won't :) 



I am not in that situation either, but the problem with Labours CGT was that it also applied to baches or if you had a weekender, so it became like a envy tax. But it is sort of irrelevent now becuase obviously their policies were a dog, as they had their worst result in nearly a hundred years, and they are still saying that they thought they had good policies. They seem to think a change of leader is all that is needed.

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  Reply # 1133687 22-Sep-2014 14:02
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I am not in that situation either, but the problem with Labours CGT was that it also applied to baches or if you had a weekender, so it became like a envy tax. But it is sort of irrelevent now becuase obviously their policies were a dog, as they had their worst result in nearly a hundred years, and they are still saying that they thought they had good policies. They seem to think a change of leader is all that is needed.


Labours policies or lack of them are Labours issue. As is their bumbling, and internal fighting. It's nothing to do with Leaders, or not getting enough press because of KDT or Dirty Politics. They oppose for the sake of it, and give no-one a reason to vote for them. They don't instill any confidence. This is all fine with me, as so long as National continues as it has for the last 6 years, they will get my vote and the more in denial Labour are, the less likely they will be in for a long time. 

The one policy they did have which was stupidity was repealing the 90 day employment act. 

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  Reply # 1133961 22-Sep-2014 18:11
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rayonline: Ok then on that argument why are shares not exempt ...



Well my shares have increased in value over the years and I have not had to pay any tax on that capital gain, I have paid taxes on the dividends.

But then if I own a art or jewellery or collectable cars, etc etc etc there is no capital gains taxes on those either.

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  Reply # 1133972 22-Sep-2014 18:26
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joker97: if there is capital gains tax there should also be capital loss tax deduction?

if I buy an audi for the purposes of selling it, and lose 100,000 on it, I should be able get my tax annulled for 5 years?

what about losing $1000 on a canon camera when I sold it?


Businesses do, it is not uncommon to see companies "Revaluing assets" which creates a paper loss and lower taxes, they also have an interesting one where if they make too much profit they can delay some of the profit until the next year.


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  Reply # 1134129 22-Sep-2014 22:11
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Tzoi:
 

For example, you may decide to place your family home within a Trust for the simple reason that it removes it from your personal assets in the event that your business fails. NZ has a curious misunderstanding of the concept of limited liability companies in my opinion, meaning that they alone do not provide sufficient shelter for your personal assets in relation to a business failure.



Generally they do, however often with a start up company the bank will require a personal guarantee as well. It is quite difficult for creditors to pierce the corporate veil unless there is fraud/a sham


Yes and no. It should be virtually impossible to pierce unless the company has been acting illegally. However I have seen instances where people try and bring morals into the equation - or just go trotting off to Fair Go.

Limited liability companies exist because no sane person would expose all their personal assets (they originated when groups of merchants put money in for trade expeditions involving long voyages IIRC) to the very real possibility of business failure - otherwise no one would be willing to start a business!

Liability should be limited to the amount (if any) unpaid for shares. This is usually zero, however.





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  Reply # 1134139 22-Sep-2014 22:54
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mattwnz:
Geektastic: 

I will also add that there are many people in NZ, judging from newspaper comments etc, who appear convinced a CGT will be some sort of magic bullet for housing prices..


Yes of course  CGT will not affect house prices one little bit. That was just politcal spin to try and make it an emotional decision. The problem with house prices is supply of land, complaince costs, building costs, building material monopolies/duopolies , overpriced labour and shoddy workmanship which often  means things need doing multiple times etc. So it is a range of different things


you missed one of the biggest factors, imo, in your list of reasons for unaffordability.... "keeping up with the joneses".  Far too many people keep 'upgrading' their houses, and moving neighbourhoods, as income rises (or not).




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  Reply # 1134183 22-Sep-2014 23:46
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Geektastic:
Tzoi:
 

For example, you may decide to place your family home within a Trust for the simple reason that it removes it from your personal assets in the event that your business fails. NZ has a curious misunderstanding of the concept of limited liability companies in my opinion, meaning that they alone do not provide sufficient shelter for your personal assets in relation to a business failure.



Generally they do, however often with a start up company the bank will require a personal guarantee as well. It is quite difficult for creditors to pierce the corporate veil unless there is fraud/a sham


Yes and no. It should be virtually impossible to pierce unless the company has been acting illegally. However I have seen instances where people try and bring morals into the equation - or just go trotting off to Fair Go.

Limited liability companies exist because no sane person would expose all their personal assets (they originated when groups of merchants put money in for trade expeditions involving long voyages IIRC) to the very real possibility of business failure - otherwise no one would be willing to start a business!

Liability should be limited to the amount (if any) unpaid for shares. This is usually zero, however.


Legally though, even if Fair Go gets involved they don't have to do anything that they say because there is limited liability that protects them. I don't see how it's any different to any other country. There'd be the same moral pressures elsewhere

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  Reply # 1134188 23-Sep-2014 01:36
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Tzoi:
Geektastic:
Tzoi:
 

For example, you may decide to place your family home within a Trust for the simple reason that it removes it from your personal assets in the event that your business fails. NZ has a curious misunderstanding of the concept of limited liability companies in my opinion, meaning that they alone do not provide sufficient shelter for your personal assets in relation to a business failure.



Generally they do, however often with a start up company the bank will require a personal guarantee as well. It is quite difficult for creditors to pierce the corporate veil unless there is fraud/a sham


Yes and no. It should be virtually impossible to pierce unless the company has been acting illegally. However I have seen instances where people try and bring morals into the equation - or just go trotting off to Fair Go.

Limited liability companies exist because no sane person would expose all their personal assets (they originated when groups of merchants put money in for trade expeditions involving long voyages IIRC) to the very real possibility of business failure - otherwise no one would be willing to start a business!

Liability should be limited to the amount (if any) unpaid for shares. This is usually zero, however.


Legally though, even if Fair Go gets involved they don't have to do anything that they say because there is limited liability that protects them. I don't see how it's any different to any other country. There'd be the same moral pressures elsewhere


Limited Liability is nice, in theory.  New or smaller companies often are unable to trade with suppliers without providing a personal guarantee - if you don't provide guarantee, you don't get to trade therefore you cant run your business.




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  Reply # 1134214 23-Sep-2014 07:03
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Regs:
mattwnz:
Geektastic: 

I will also add that there are many people in NZ, judging from newspaper comments etc, who appear convinced a CGT will be some sort of magic bullet for housing prices..


Yes of course  CGT will not affect house prices one little bit. That was just politcal spin to try and make it an emotional decision. The problem with house prices is supply of land, complaince costs, building costs, building material monopolies/duopolies , overpriced labour and shoddy workmanship which often  means things need doing multiple times etc. So it is a range of different things


you missed one of the biggest factors, imo, in your list of reasons for unaffordability.... "keeping up with the joneses".  Far too many people keep 'upgrading' their houses, and moving neighbourhoods, as income rises (or not).


The other big issue is the costs of buying and selling.

A friend in the UK who sold his house paid 0.75% to the real-estate agent, and that included advertising.

Buy a house here and you need to 6% to cover them and the lawyers fees when you sell.

Realestate fees are a blatant rip off, out of the 3 "professionals" involved (lawyers, Building inspectors, realestate agents) the real-estate agent make the most money and yet is the least qualified.

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  Reply # 1134245 23-Sep-2014 08:22
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sir1963:
rayonline: Ok then on that argument why are shares not exempt ...



Well my shares have increased in value over the years and I have not had to pay any tax on that capital gain, I have paid taxes on the dividends.

But then if I own a art or jewellery or collectable cars, etc etc etc there is no capital gains taxes on those either.

Have you sold/crystallised the gains? Are you a trader?

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  Reply # 1134295 23-Sep-2014 09:02
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sir1963:
Regs:
mattwnz:
Geektastic: 

I will also add that there are many people in NZ, judging from newspaper comments etc, who appear convinced a CGT will be some sort of magic bullet for housing prices..


Yes of course  CGT will not affect house prices one little bit. That was just politcal spin to try and make it an emotional decision. The problem with house prices is supply of land, complaince costs, building costs, building material monopolies/duopolies , overpriced labour and shoddy workmanship which often  means things need doing multiple times etc. So it is a range of different things


you missed one of the biggest factors, imo, in your list of reasons for unaffordability.... "keeping up with the joneses".  Far too many people keep 'upgrading' their houses, and moving neighbourhoods, as income rises (or not).


The other big issue is the costs of buying and selling.

A friend in the UK who sold his house paid 0.75% to the real-estate agent, and that included advertising.

Buy a house here and you need to 6% to cover them and the lawyers fees when you sell.

Realestate fees are a blatant rip off, out of the 3 "professionals" involved (lawyers, Building inspectors, realestate agents) the real-estate agent make the most money and yet is the least qualified.


I can confirm that.

When we sold our flat in the UK we sold it for the equivalent (at the exchange rate of the time) of $700,000 and paid the equivalent of $2000 in agents and solicitors fees, including all the advertising costs.

When we sold our first NZ house for $650,000 we paid over $25,000 in fees!! At that rate an agent only need sell 4 houses a year to make a decent income.

Considering most agents here appear to be numpties who add little or no value to the process it astonishes me that they have the brass neck to charge so much.





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  Reply # 1134297 23-Sep-2014 09:03
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Tzoi:
Geektastic:
Tzoi:
 

For example, you may decide to place your family home within a Trust for the simple reason that it removes it from your personal assets in the event that your business fails. NZ has a curious misunderstanding of the concept of limited liability companies in my opinion, meaning that they alone do not provide sufficient shelter for your personal assets in relation to a business failure.



Generally they do, however often with a start up company the bank will require a personal guarantee as well. It is quite difficult for creditors to pierce the corporate veil unless there is fraud/a sham


Yes and no. It should be virtually impossible to pierce unless the company has been acting illegally. However I have seen instances where people try and bring morals into the equation - or just go trotting off to Fair Go.

Limited liability companies exist because no sane person would expose all their personal assets (they originated when groups of merchants put money in for trade expeditions involving long voyages IIRC) to the very real possibility of business failure - otherwise no one would be willing to start a business!

Liability should be limited to the amount (if any) unpaid for shares. This is usually zero, however.


Legally though, even if Fair Go gets involved they don't have to do anything that they say because there is limited liability that protects them. I don't see how it's any different to any other country. There'd be the same moral pressures elsewhere


No there isn't. The moral pressure here is far greater due to the increased visibility resulting from a smaller population. You can't just get lost amongst the other 65 million people!





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  Reply # 1135167 24-Sep-2014 07:32
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bazzer:
sir1963:
rayonline: Ok then on that argument why are shares not exempt ...



Well my shares have increased in value over the years and I have not had to pay any tax on that capital gain, I have paid taxes on the dividends.

But then if I own a art or jewellery or collectable cars, etc etc etc there is no capital gains taxes on those either.

Have you sold/crystallised the gains? Are you a trader?


No and No.

However not being a trader means I don't pay capital gains on shares, just as I don't pay on increase capital value on jewellery, stamps, collectables,cars, etc etc etc.

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