Sunshine Coast Region, Queensland
Accountant in Diddillibah
A side venture that runs at a loss, and a parent's house to sell
Business losses, capital gains and individual returns for Diddillibah households, from a CPA practice.
Diddillibah is a semi-rural locality 7.4 km west of Maroochydore and 11.4 km east of Nambour, sometimes called the valley of the snakes. Its name is linked to the Aboriginal word dhilla, meaning coarse grass or carpet snake, and ba, meaning place. The 2021 Census counted 1,703 residents, up from 1,403 in 2016, with a median age of 46.
The valley's community buildings
A school, a hall and a fire station on Diddillibah Road.
Diddillibah Provisional School opened on 14 September 1885 in a building put up by local people led by Richard Heddon. It became Diddillibah State School in 1909 and closed on 14 May 1962; the site is now Ash Road Park. Frank Nicklin officially opened Diddillibah Community Hall at 658 Diddillibah Road on 2 June 1938, and the Kiel Mountain Rural Fire Station is at number 670. There are no schools in Diddillibah today.
In 2021 the locality had 700 private dwellings with an average of 2.6 people per household. Median weekly household income was $1,424 and median monthly mortgage repayments were $2,200.
Three questions for semi-rural households
A side venture that makes a loss
Why it happens
A household starts something alongside its main income: a few head of cattle, a nursery, a market stall, a small contracting business.
Why it matters
An individual can only offset a loss from that activity against wages and other income if their income for non-commercial loss purposes is under $250,000 and the activity passes one of four tests: at least $20,000 of assessable income from it; a profit in 3 of the past 5 years including this one; real property of at least $500,000 used in it, not counting a private residence; or other assets of at least $100,000 used in it. Otherwise the loss is carried forward to be used against future income from the same activity.
How we help
We work with you to understand your goals and help shape the future of your business and personal wealth. Keep the income, expenses and assets of the venture in records separate from the household's.
The primary producer exception
Why it happens
The side venture is a primary production business, such as cattle or a crop.
Why it matters
A primary producer who is a sole trader or partner can still offset a loss if their assessable income from other sources, not counting net capital gains, is less than $40,000.
How we help
We help clients legally minimise tax by optimising business structures, claiming all eligible deductions, and planning ahead for key tax opportunities.
Selling a parent's home
Why it happens
A family inherits a house and decides to sell it once the estate is settled.
Why it matters
An inherited dwelling is exempt from CGT if the sale settles within 2 years of the death and either the deceased bought it before 20 September 1985, or it was their main residence just before death and wasn't being used to produce income. The exemption applies even if the family rented the house out during those 2 years. An extension of up to 18 months is automatic if five conditions are met; otherwise you can ask the Commissioner. A later sale may only get a partial exemption.
How we help
At Lomandra Accounting, we don't just crunch numbers. Keep the date of death, the will or probate documents and the settlement date of the sale together.
Frequently asked questions
Can I claim a loss from my Diddillibah side business against my wage?
Only if your income for non-commercial loss purposes is under $250,000 and the business passes one of the four tests, such as $20,000 of assessable income from it. Otherwise the loss is deferred.
What are the four tests?
At least $20,000 of assessable income; a profit in 3 of the last 5 years; at least $500,000 of real property used in the business, excluding your home; or at least $100,000 of other assets used in it.
Do I pay capital gains tax on my parent's house?
Not if the sale settles within 2 years of the death and the house was their main residence and not producing income just before they died, or they bought it before 20 September 1985.
What if it takes more than 2 years to sell?
An extension of up to 18 months applies automatically if all five conditions are met; otherwise you can ask the Commissioner for one. Without an extension, part of the gain may be taxable.
Where to next
Have a question?
Sort out the paperwork
Stay compliant with ATO regulations, avoid penalties confidently.
Lomandra Accounting is a CPA Practice, registered with the Tax Practitioners Board and an SMSF Specialist. Emma, the Director, is a Certified Practicing Accountant (CPA) with extensive experience in commercial business management, and specialises in Self-Managed Super Funds (SMSFs).
- 07 5234 9201
- admin@lomandraa.com.au
- Sunshine Coast, QLD
- Monday to Friday, 9am to 4:30pm