I can't see it mattering whether you had a business created or not, the deduction will be with the owner of the land.I assume only half of it would be deductible anyway since part is used for the PPOR, and even then it may be a capital cost which means you could only claim 2.5% pa or off the CG when you sell.Why not just pay cash and claim it too?…[Read more]

Foreigners cannot own land in Indonesia.

I don't think it is a grey area. If you are staying there then you cannot claim for this period. If your friends are staying there then you cannot claim, or have to account for market rents, if it is vacant and you are looking but cannot find tenants it should be claimable.You just have to keep track of it all.

Hi SharonWould you provide some figures?you can't be getting out less than you put in otherwise you are losing money! So you must have it wrong.bear in mind COCR is only one measurement and doesn't necessrily mean a deal is bad.eg $100,000 in a development of $1,000,000 and you sell for $1,500,000or $1,000,000 into a development of $1,000,000 and…[Read more]

Try to work out more accurately what the CGT will be.eg. The gain was $67,000 eachtake about the buying and selling costs (stampduty, legals, agents fees etc)say $10,000= $57,000then apply the 50% discount = $28,500This then goes on top of your partners other taxable income.say she will pay 20% tax, that is nearly $6000 in taxSo you might get…[Read more]

Yes, best not to have any loans PI unless you cannot control your spending.Rob – wonder how much tax you could have saved? – sorry, no use cryiing over split milk, but good for others to learn.

Hi BlissyI think Richard may have been talking about the next loan there.For this one I would suggest you ring St George and say you wish to change over to IO and set up a 100% offset attached. Sounds like you may not be on the professional package and you may be on their cheap loan – the basic maybe? The offset account is only available on the…[Read more]

Whoa! beware of paying money into a investment loan and redrawing it.Pretty soon none of the interest will be deductible, but you will still have a large debt. Its a tax time bomb!To understand why you will need to know a bit about the ATO’s tax treatment of loans.Just remember:Every time you pay money into a loan this is a deposit.Every time y…[Read more]

Your incomes are pretty much the similar so it won't really matter whose name you get it in with the first one. I would suggest you only use 1 to reduce the risk – if something were to go wrong only 1 goes down instead of both.If it works, then look a using a discretionary trust for the next one – again just using 1 person, keeping the other free.…[Read more]

In the early days of investing it is very hard to avoid LMI. Just keep saving and letting the growth kick in and you will get there.

LOC is a particlular product. Each bank has slight differences- could be that it has a cheque book included, not necessary to pay the interest each month (capitalise) etc.There are also very important tax consequences between using a LOC and redraw or topping up an existing loan. You should neve do it if it will mix personal and investment debt.

330,000 x 80% = $264,000(this is the max loan in total to avoid LMI)$264,000 – existing loan of $255,000 = $9,000(= the max extra you could take out without LMI)If you wanted to borrow more and were willing to pay LMI you could go to 90%$330,000 x 90% = $297,000Less current loan of $255,000= $42,000 extra (LMI may be able to be added to the loan…[Read more]

The equity is 330,000-255,000 =$75,000But you cannot use all of it. The banks will only lend a certain %. ie LVR.They will generally lend 80% without paying LMIor you can go up to 90% with LMI

Loan A and B have no connection. Just think of them as being 2 loans at different banks. Loan B can be a LOC so you will only need to pay interest when you take the money out.In your situation,$330,000 x 80% = $264,000Current loan = $255,000Available equity = $9,000This is assuming you stay at 80% LVR – you obvously started much higher .So to get…[Read more]

Yes, never cross collateralise.  There are many reasons – but tax isn't one of them.What you would do it to take out a separate loan on the first property and use that for deposit for the second.eg. $100,000 House with $50,000 loan (Loan A)80% value is $80,000You you take out another loan for $30,000 (loan Total loans = $80,000LVR 80%You then…[Read more]

Well one partner is just buying out the second. So it will be just the same as buying a another property – you need to apply for the loan, bank assesses the applicant, does the valuation, gives the approval and then the solicitor changes the title. The only difference is negotiations between buyer and seller should be easier.

hiI would think a discretionary trust is worth investigating further.What I would do it to set up a LOC, or maybe 2 on the existing house (I assume it is paid off??). Use one for onlending to the trustee of the new trust for the 20% plus costs of the new puchase. The remaining 80% can come from a new stand alone loan.As for the existing house you…[Read more]

Actually they will know from the tax return – the location of the income. But if you have been contracting on and off and paye in between it should be ok.

no, they won't actually know. As long as you have held the ABN for 2 years at least and are registered for GST for 1 year at least.

Sarah Finn wrote:
We have been told that you cannot refinance for an increased mortgage once the value of Property A goes up and use it to pay for Property B if property A is an investment and Property B is your own home; but you can refinance an investment and use the money to purchase another investment property, ie, all investment…[Read more]