insurance

hi val
whats a peppercorn rent

Peppercorn rent = cost/ price of a peppercorn ,, pepper was once very expensive but 1 peppercon is next to worthless , bit like trying to put a price on 1 grain of rice,, lol.

perhaps a more understandable explanation would be;
peppercorn rent is a "token" sum, such as a sporting club paying $1 per year. It is soley to show that a transaction has taken place, as "free rent" etc is very difficult to show what is actually taking place.

Hi sayo,

By peppercorn rent I mean a very small, almost negligible rent - maybe $1 per week, something like that.

I've now realised that there is a lot more involved. Don't know the situation in NSW, but in ACTany rental property is hit by land tax. (At the time of the Canberra fires, when 500 homes were lost causing an accomodation crisis, friends who had an empty house found they simply couldn't make it available. They would need to rent it in order to insure as landlords, and if they rented, even for a peppercorn amount, they would be hit with ACT land tax. The costs were such that it had to remain empty.)

The other consideration is capital gains tax. Your home is usually exempt of federal capital gains tax, but not for any period it is rented. NSW has it's own taxes for landlords too, and also a capital gains tax for properties which are not owner occupied. (rental properties, the cottage up the coast, etc). Please check this out for yourself - I'm no authority on these things!

It's a sticky one. If you find a satisfactory solution, please post it here for everyone's benefit.

Cheers

Val