Overseas investors are turning home-owning into a business without the tax issues, says a reader.
Home ownership is one of the most important factors in the stability and well-being of young families; something governments should be encouraging and assisting in.
Why then has central government made this virtually impossible to attain by allowing essentially open immigration and by designing a tax system which allows house
investors to be classified as running a business?
This enables investors to claim all mortgage interest costs, plus repairs and improvements as a tax deductible write off against rental and other income. These are the main drivers of house price escalation. No tax deductions are available to home owners/occupiers.
If one has surplus income why would anyone deposit it in a bank to get a taxed interest return of less than inflation when one can invest in property with all costs tax deductible, have a tenant pay off the mortgage and eventually pocket a tax free capital gain?
A no-brainer! Just like the politicians who continue to allow this.
