I'm curious, there are people here who spend $2k every year on the latest phone.
Why?
Why Do You Buy a New Phone Every Year?
deme on 26/09/2023 - 15:55
Comments
2k poorer you mean
Gentlemen we got another one
DJ Khaled?
RIP
it's dividend time. Those franking credits mean the taxpayer is picking up the cost every year
Do you actually have no idea what franking credits are… or do you legit think people should pay tax twice ?
If I own 1% of a company that makes $1m - my part of the company makes $10,000. The company pays tax on my share of the profits on my behalf, corporate tax rate is 30% = $3000 tax paid.
If I take it all as a dividend distribution, presuming I have other income, my tax rate may be higher, say 37% - so the tax for me would be $3700.
I declare the lot, get assessed as $3700 less my $3000 franking credit for tax already paid on my behalf by the company management on my portion of the same earnings = I have to pay more tax of $700 to top it up to $3700 to match my tax bracket.
Taxpayer didn't lose out on a brass razoo.
Without franking credits, $6700 would be paid on just $10,000 earnings = 67% !!!!
The taxpayer would miss out more if I didn't take any distribution, the company retained the earnings to reinvest, and no franking credits existed on it, because a total of $3000 would be paid in tax.
Care to share a time-saving post?
Surely OB is all about sharing time saving and money saving opportunities
@HeWhoKnows: Not at all. If anything, OzB has more often left me poorer by buying things that I didn’t want otherwise or spending time reading and replying to topics which I wouldn’t have.
@EyyBanane: I probably could have got a masters if it wasn't for OzBargain
Scotty! Where's my certificate?!
@EyyBanane: Haha…yep 100% true…i have a garden shed full of stuff i didnt need to buy but bought anyway as it was a "bargain". Now what to do with all the money i saved by buying all that…
100% write off via an ABN?
Do you know how ‘work expenses’ work?
New iPhone 15 pro max $2200
Tax deduction - $660
Sell iPhone 14 pro max - $1200
Total $340@greatlamp: If you sell a business asset (the iphone 14) you have to pay tax on it though. So if you do this every year, you will have income of $1200 and an expense of $2200. The net result will be a deduction of $1000. So more like $2200-325 = $1875 out of pocket, depending on your tax bracket.
@greatlamp: Im sure a lot of people wouldnt, but if you were audited and it was picked up, you would be liable for the tax and penalties.
No argument there, but if you do get audited you'll be in a world of hurt
No you won't. At worst you'll be asked to correct your taxes and pay back what is owed on the sale of the phone.
@Harold Halfprice: Not if they can prove you intentionally aimed to misreport your purchase. Which most likely they won't.
@mavis30551: Watch out, the ATO have been going after "small fish" in batches/waves the last few years. They are more and more automating their systems to flag discrepancies and asking accountants to explain anomalies. There are whole swathes of people that have been flagged and often fined. Go ask your accountant about it.
Eventually it's likely they will track basically everything, and any minor fraud will be immediately obvious to them. No idea when this will come, i suppose cash will slow it down - but even then, they aren't so stupid that somebody selling their iphone every year for cash is going to slip under the radar.@mavis30551: to be fair the tax office only ever goes after the small fish. The big fish have armies of tax lawyers and are often way too much trouble. Not to mention that your average tax official has their eye on their next job in the corporate world too
@spoonmugen: No. They will ask what you did with the phone when you bought a new one. If you say that you sold it below market value or gave it away then they will treat it as you selling it at market value. Youre supposed to keep records of these transactions the same way you keep records of all other business transactions.
@haggertm: you're not allowed to give stuff away?
not just fones, but you give any stuff away they treat you as selling it and making $ on sale?@furyou: If it's a business asset that you have claimed a deduction on, then it will be treated as you disposing of it at market value. If its a private asset that you havent written off through a business then you can do whatever you want with it.
@Bearlion: The sale of a business asset is business income. Not declairing business income in order to evade paying tax is called tax evasian. If you are audited and it is picked up, you will be liable for the tax and penalties.
They just write them off
@Brick Tamland: You don't even know what that means do you?
No… but they do, and they're the ones writing it off.
aka tax rort if they use the phone for personal, and hard to prove if that's the case.
It's really not that hard for them to prove. The ATO basically says "prove to us it's used for work" and if you can't provide documentation they will either make adjustments or fine you. Eg they would likely want to see evidence you have a separate personal phone, and call records of the work phone. I see a lot of old fashioned ideas about how impotent the ATO is - yeah 20 years ago you could get away with a lot.
Salary sacrifice if your employer allows you to or you are an employee of your own business.
Cause they want to appear richer than you.
I think when people have a lot of money they spend on everything just so the money is spent and not left over
- because they can
- because they (or the bank of mummy and daddy) can afford it
- because they look cool
- because they want the latest and greatest
- because they consider phones as a status symbol
^ 99% this why most people get it… they dont stop there but want the pro max or whatever the most exp there is too..
To the untrained eye they all look the same these days.
so do handbags. sneakers. jeans.
All of the 18 yo's I work with, making 20k a year have the latest iPhone. I get what you mean but the 'status' part is always lost on me.
I agree, I don’t see them as a status symbol either.
As I learnt long ago, it's all about being "cool". The concept of kuhlness explains 95% of the behaviour of humans under 30 years of age. Trans is really cool right now. Young people are willing to be surgically sterilized because they think it will make them cooler.
I was a mifit as a child; I was never interested in social status.
@RefusdClassification: I'm still a misfit. We should start a club but someone stole the name already.
@RefusdClassification: I agree aspects of what you are saying for sure - that appearances motivate a lot of consumer behaviour. However, I think it's an extreme take to suggest that the majority of transgender people undergoing surgical changes are motivated to be 'cool' (and pretty offensive to them too).
@soaringphoenix: It would be hard to deny that it’s not a factor at all though - suddenly a whole bunch of people want to be this or that, often before they’ve fully grown up.
@WhyAmICommenting: I don't think being trans is that trendy. It's not something you can just fake, you've got to be either insanely committed or actually trans to go through with changing your identity and potential surgery. Bisexuality on the other hand is something that you can just claim and no one will question.
it's a good substitute for a personality. I have money now, but grew up pretty poor, so got used to not having the best stuff.
Because they "deserve" it
Because some workplaces allow you to salary sacrifice. So once you salary sacrifice and sell your old (last year's phone), you basically got a free phone. And sometimes you have a profit. So in this scenario why would you give up a free phone?
Because hat money you saved is usually returned to you at tax time, or you aren't doing things right
I used to do this every year until the iPhone X but then stopped till got the 15 Pro Max last week.
The essence of it is, you're not blowing $2k every year. iPhones retain their value very well and if you time it right, you can trade-in/sell it for ~80% it's value then just top up a bit more and get the latest and greatest.
That's approx ~$30 a month effective cost, which is not unreasonable for many, for a device you use constantly all day every day. It's barely a round nowadays.
While past few years the upgrade incentive has been quite lackluster, there's still lots of added (smaller) features that many people do find a worthy differentiator from one gen to the next. Others don't and that's fine too.
lucky you. i stop buying apple just after iphone 4.
using 3gs for years, best iphone. easy jailbreak.
3GS reminds me of a simpler time
When you drop a Nokia phone and fix it yourself?
@sam-1966: And by fix you mean: insert battery, attach removable back plate and press and hold the on button for about two seconds… I can still remember the Nokia chime and welcome screen.
Nokia 5110 for me!
First phone was a Mitsubishi of some sort
3GS reminds me when Rudd gave everyone $900 or something that amount to buy the phone.
what you doing after 3g drops off the grid
How's your 3gs holding up? Glad it can still access OzBargain.
I do this. iPhone XS and next will either be the 15 but hoping that I can stretch the current phone for another year becaue I wasn’t that impressed with the 15 (because I wait so long I do want the USB C though)
There was a time when I cared about what all I could do with a phone but I just don’t care anymore. Buy an iPhone, Re image it to my current iPhone and then continue using it.
This really.
I used to buy a new iPhone every year and sell the old one for 80% of the original cost. $300-$400 a year for a new phone was absolutely fine.
Also used to get the tax back when flying out the country not long after purchase to save even more.
Have stopped bothering now the jump in tech has gotten so much smaller, and the price of the phones has jumped through the roof.
2-3 years for me now.Can pick up a decent phone for 200, maybe the camera let's you down a bit in low light if you can live with that. Been using kine for 2 years and could easily get 2 more, spec wise it's got 8/128gb, oled screen, can't think of what else it needs to do
I used Android from about 2010-2015. Moved to iPhone and never looked back. Much prefer it.
@ldt: Android isn't a brand it's an operating system. There's a vast range of phones in all price ranges using android.
I moved from apple to android some years ago. Both systems work well but far more choices of phone and for any budget with android. Rest of my family have iPhones but I've preferred my choices over the years.
Currently have pixel 7 pro, great phone. For two and a half years or so before that had a Redmi note 10 Pro which was absolutely superb value at $360. Sold it for $250. Brilliant battery life, all usual features, even the camera was decent although obvs not at the pixel level.
The point about very decent phones being available for a few hundred bucks is a valid one.
@Brianqpr: I am aware of what Android is.
All very nice stories, but I still don’t want an android phone.@ldt: Good for you. Well done. To me both systems are as user friendly as each other so it comes l down to phone choice and what represents good value.
I did enjoy the rest of my family moaning about their iPhone batteries dying during days out on holiday while I had well over 50% on my $360 Redmi.
This is it basically. Instead of the iphone - I prefer Samsung Galaxy phones and the trade in value is incredible.
The out of pocket is a nominal cost considering it's something I use everyday. When the upgrade doesn't cost anything extra - it definitely is a no-brainer.
~80% of its value for used? Isn't it already <80% brand new by this time? i really don't know but doesn't sound like it would retain value that well! Even then, proposition of 2k for something as useful as a phone doesn't sound like much but reality is, most people would be happy with a phone half the cost. Might not be a lot, but still arguably waste of money.
-sent from iphone15uraniumYeah this sounds like rubbish to me. No one is buying a used iphone 15 this time next year for $1.6k
yeah, even brand new as soon as you open the box it's 80%. Last yr's model? Someone will offer you 30% on gumtree or fb market.
$2k is just disposable to some. For some it is too much.
Not everyone have the same financial status in life.
That's exactly right.
Downside is some people do not understand this concept and feel having the latest and greatest is the priority even if it means spending above their means.
One prime example is some kid in China about 10 years ago literally selling his kidney in order to be able to afford an iPhone /iPadIn brighter side, someone is now using that kidney. Win win. lol
Someone on a forum recently mentioned f**k-it money. If you've given up buying a house, you'd have a lot of free cash at the moment.
For example, if you've saved a third of the price of a modest Sydney house you'll comfortably be able to afford a base-level Lamborghini.
Put another way, for the price of a modest Sydney house, you could buy a new iPhone every two months of your life - even the years you were in diapers. Plus it's a tax deduction.
This has almost nothing to do with it. Poor people are buying the latest iPhone like crazy.
They just do it on plans.
Wasting money isn't the hobby of the rich, it's the folly of the thoughtless.
mobile phone on plans = car on finance
Argue sake = Car is necessity. Obviously same as phone.
How do you know they are poor? Is it because they got the phone on plans?
Not everybody insists on a 100k plus car though. Perfectly good phones available for well under $500 that would do everything 95% of people need.
@Brianqpr: why would you spend $500 when you can have $150? For you $500 is cheap, so you have to understand that 2.5k is cheap for some.
People have to accept that people are not on the same boat when it comes to finances.
This is irrelevant. The prevalence of iphones is plain proof that most owners are not so wealthy that $2k is meaningless to them, and in fact it's argued that such status symbols are more popular among people that actually can't afford them - i.e. https://en.wikipedia.org/wiki/Conspicuous_consumption
Why not?
- Cost
- Environmental impact
- Time
So what
- A lot of people salary sacrifice the new one, sell the old one, wind up basically zero out of pocket
- It's not like the old one is going in the bin, but I agree, ewaste is a huge problem
- Hit the order button on the Apple website and do a data migration while you're eating dinner after it arrives
dude stop fooling yourself about the environmental impact. 20 million populated Australia or 4 million populated Norway wont stand a change against the asia block from Pakistan to China whose total population is above 3 billion and have more important problems than global warming or environmentalism.
you can use chemical free soap, you wont be saving the planet earth by doing that.
You may not know this, but they have phones in China too.
@deme: Apple just broke a sales-record with the iPhone 15 Max in China. It's one of their biggest markets.
cause they are richer than you