DanWhat about s 40.65 of the GST Act which states new residential premises are not input taxed. New residential premises is defined in s40.75 as not been previously sold – within 5 years. If they are not input taxed and not GST free then wouldn't GST apply? Is intention relevant here?ps I hope not!

You probably could transfer the property, but it will be subject to stamp duty and CGT (if investment). You will need specialist advice as you are covering 2 countries with different laws and difference tax treatments.But, why not leave it as is? If you will buy more why not look at setting up a new trust and spreading the risk a bit.

housegoodies wrote:
Legal implications in Tenants in Common and the Perth IP MarketDoes that mean if someone sues me they can only take away 1% of the IP value due to the fact I only have the 1% share in the IP?IP Starter

Yes, generally this is the case.

Don't like your chances. Banks have no obligations to lend money or to meet deadlines. Nevertheless I would contact their complaints department and talk to them about it.

PRKLCD wrote:
HI all I have been reading on here for a bit and now I need some advice. I am married and my wife and I are looking at buying a house with another couple. The house we are looking at is $500,000 and has a couple of years left on a DHA lease. Upto this point, we haven't thought about investing with another couple, but it we like…[Read more]

Mossman wrote:
I have a Family trust which my accountant has told me is excellant if the investment property which the trust purchased in 2007 becomes positively geared from what I can gather it is similar scenario trust function as to comments Qlds007. My concern is that after three years of payments and little or minimal capital gains, whats…[Read more]

its possible for up to 6 years

matthewp wrote:
  Q3. Saving for another property I

Why not pay IO and put all cash into the offset account and then borrow equity, rather than using the cash, to pay for the deposit on the new IP. This way you will still have access to your cash in an emergency and will also have cash available for personal expenses. If you used your cash…[Read more]

matthewp wrote:
Q2. Interest only loan and positive cash flow 

You should NEVER had a PI loan on an IP if you still have personal debt – otherwise you are throwing away money.However, if you have paid off all personal debt, then you could have a PI loan, but I would still suggest you get an IO loan. You can then free up more cash to invest…[Read more]

matthewp wrote:
Q1. Gross Rental Yield: 

Think about this for a second. If you lower the rent you will get a lower yield – but will this make your property grow faster?I think what the magazine was probably saying was that generally lower growth properties, especially those in the country, tend to have higher yields.5.9% is not bad – but it…[Read more]

Theres no need to give reasons. I would just say you want to free up cash for personal expenses. IF your PPOR would become an IP then you will need to change things around – depending on how it is set up, so you may need a new ruling. eg you would no longer want to put cash into an offset against this house and you may also want to borrow to pay…[Read more]

If you are borrowing money and then mixing it with cash in as savings account, then you will be contaminating the borrowed funds and this will dilute the deductibility of interest. Another potential problem is minimum withdrawals from the redraw and possible fees per redraw

It can be worse than that. Imagine you own 2 properties cross collateralised and values drop. If you tried to sell one it is possible the bank would not release the security unless you paid the loan of the remaining one down to meet LVR requirements.This happened to a guy I know who went thru a divorce and a heart attack. He couldn't meet…[Read more]

Terryw wrote:
If you remind me i can give you the link to a private ruling and a tax ruling on these issues – I've saved the info on my other computer.

see TD 2008/27 which basically says capitalised interest retains its character.http://law.ato.gov.au/atolaw/view.htm?docid=TXD/TD200827/NAT/ATO/00001 Private rulingsPBR 78123PBR 69725PBR…[Read more]

If you remind me i can give you the link to a private ruling and a tax ruling on these issues – I've saved the info on my other computer.

This is possible if you set it up correctly. You could even possibly borrow to pay the interest too.

gcp wrote:
Thanks Terry. Sound like the issue may be the intention of the use of the funds freed this way – it would have to be for income producing purposes.Another question. Would a family trust be a better option? Not sure how complex this is to set up and how the ATO would view this as per my original post?

Its not so much intention of the…[Read more]

If you use redraw it will not be good for tax reasons as your loan will be part investment and part personal – how would you pay down the personal bit first.I think your best bet is to set up a separate split, interest only, and use that as 20% deposit and then borrow the rest as another loan.

Sounds like you had better see your lawyer.

this sounds like  a  scheme to avoid tax, so the ATO can apply Part IVA of the ITAA 1997 and disallow the deduction. If you try to keep it commerical, then it may be more likely to get thru. As Dan mentioned, if the loan is unsecured, then it may be commerically justifiale to charge higher rates, possibily similar to what a credit card comapny w…[Read more]