Commercial Lease Tax Invoice Requirements

[damo]

Does anyone know how often a land lord is required to issue a tax invoice to the tennant of a commerical property?

I have been issueing them on a monthly basis, but if I can get away with doing it less often (like yearly) that would make my job easier.

[ShinymetalASS]

You should issue them when each payment falls due.

Usually this would be monthly in advance. (Although I have done rural properties paid in arrears).

General rule is that you are owed the money once the Tax Invoice is issued.

You want pay? You make invoice.

[dwarfthrower]

Shiny is on the money. As with most commercial arrangements, the number of legs you have to stand on if the other party doesn't pay up is significantly reduced if you haven't actually been invoicing them for the amount required.

[ShinymetalASS]

Strictly speaking your lease document probably specifies payment without demand for rent as and when it falls due. If it says that then you dont HAVE to issue Tax Invoice (no demand requirement).

Out of courtesy for your tenant though, you should at lease issue statements each time.

And if you have no written agreement (:mdr:) MAKE SURE you issue Tax Invoice. No demandy = No payee)

[damo]

I probably should have mentioned these are intercompany transactions, so no risk of non-payment. They pay when I do the bank transfer.

I love the separation of duties conflict going on here, I am performing the entire transaction from determining the rent amount, to issuing the invoice to posting the transaction and doing the payment.

[ShinymetalASS]

TAKE FULL FUCKING RECORDS THEN.

ISSUE INVOICES EVERYTIME AND MAKE RECIPROCAL RECIEPTS.

You want to fucking create a lovely paper trail my friend.

The tax man he no likey avoidance schemes.

[dwarfthrower]

Intercompany or intracompany? Intercompany still leaves you open to non-payment to some extent.

[dwarfthrower]

The tax man he no likey avoidance schemes.
But he loves when you offer to fly him to the bahamas to conduct your yearly audit, all expenses paid of course.

[damo]

Its all legit, one company owns the properties, and charges rent to the sales companies who occupy them, all based on independant valuations and commercial rates, so its tax minimization, not avoidance. I only have one tennant who is outside of the group.

Oh and its not my company, I'm just a grunt pushing the paper.

[ShinymetalASS]

so its tax minimization, not avoidance..

As long as you can show the paper trail. And since that's your job, cover your arse and do a comprehensive job.

It's a standard Tax Minimisation set up essentially, but as I said, the closer the entities, the more potential trouble you might have. Even if it is just suspicion. You got the docs there to back it up, you can substantiate, and that's all that matters :)

[damo]

Everything is all above board, with correctly formatted tax invoices, independant valuations, proper transfers of cash from one entity to another, with a complete paper trail.

Plus it is all independantly audited on a yearly basis, and signed off by the directors of the company and the auditors.

[ShinymetalASS]

Everything is all above board, with correctly formatted tax invoices, independant valuations, proper transfers of cash from one entity to another, with a complete paper trail.

Plus it is all independantly audited on a yearly basis, and signed off by the directors of the company and the auditors.


Then you should have known the answer to your own question ;)

For substantiation alone, make out an invoice for each rental installment.

[banga]

you could make some extra money in the real world helping ppl out with there taxes shiny ill bet ,

[stevecai]

Are you a tax consolidated group? if so you might not have to worry about some of this stuff.

I can't remember how consolidation applies to GST, but it makes all your intra group income tax related transactions have no tax effect.

[Arsozah]

you could make some extra money in the real world helping ppl out with there taxes shiny ill bet ,


lol, and increase her billable hours as well :)

Tax planning FTW!!!