Hi Guys

Rob, I can see your warming to the idea!

Derek, I beleive Steve Navra has a private ruling concerning his deductibility of interest for his cashbonds. Because the cashbonds return only about 4%, and it will cost you about 7% to borrow the money to buy them, there is a shortfall. The ruling is about the deductibility of this shortfall.…[Read more]

I am not an accountant, but think that would be a capital improvement. You should be able to claim depreciation though.

You should be able to start claiming costs as soo as you are renting or attempting to rent the property.

Terryw
Discover Home Loans
Mortgage Broker
North Sydney
Terry@discoverhl.com.au

I don’t know. But it is treated similar to legal fees. They are purchase costs.

It would be good if I am wrong as it would be much better to claim them up front. I guess it could come down to the wording of the tax invoice>

Terryw
Discover Home Loans
Mortgage Broker
North Sydney
Terry@discoverhl.com.au

What a mess!

I would think it a good idea to get the superfund out of those properties completely would be a good idea. You could buy them from your superfund. Stamp duty would be payable, but it would only be charged on the portion purchased. The superfudn would have to pay CGT, but I beleive this is only 10%.

At least this would separate the…[Read more]

It probably depends on where and what you are buying.

If you were buying cheap little properties in country areas, these may have not had any growth for many years. Then suddenly investors start buying in there for yields. This pushes up the price but rents hardly increase. This probably is the time to exit this market. it would be no good…[Read more]

I have heard that these fees would not be claimable up front, but would form a part of the capital base (and only be deductible against CGT if the property is sold).

Terryw
Discover Home Loans
Mortgage Broker
North Sydney
Terry@discoverhl.com.au

No. Not against personal income, just against other income the trust makes. Losses cannot be distributed.

If you had a hybrid discretionary trust, the unit holder could borrow the money and claim the interest against their personal income. In effect this allows negative gearing with a trust.

Terryw
Discover Home Loans
Mortgage Broker
North…[Read more]

Sounds fine to me. You will be actually purchasing in the name of the trustee as trustee for the trust. The trust name doesn’t appear in title.

Terryw
Discover Home Loans
Mortgage Broker
North Sydney
Terry@discoverhl.com.au

What’s wrong with you Rob? Do you just like to argue?

I will put up an example tomorrow. Don’t dismiss it just yet.

Terryw
Discover Home Loans
Mortgage Broker
North Sydney
Terry@discoverhl.com.au

Thank you Rob.

Terryw
Discover Home Loans
Mortgage Broker
North Sydney
Terry@discoverhl.com.au

Have a look at the book by the Reno Kings. There is a chapter in there about people who specialise in this area.

Terryw
Discover Home Loans
Mortgage Broker
North Sydney
Terry@discoverhl.com.au

Hi Rob

Maybe I haven’t explained it properly.

Neither Navra nor the IC advocate buying property when you cannot afford to. They merely advocate getting yourself into a position, while you are working, of purchasing good quality high growth property. During years of growth, part of this growth can be borrowed to live on or to supplement living.…[Read more]

No, Please don’t go though it all again!

I would just be very careful when giving advice to clients about borrowing money and parking it in an offset account. Especially in writing on company letter head.

Terryw
Discover Home Loans
Mortgage Broker
North Sydney
Terry@discoverhl.com.au

Rob

I have found the article by Julia Hartman regarding the loss of deductiblity of interest if borrowed funds are placed into a savings account. Please have a look at:
https://www.propertyinvesting.com/forum/topic/13853.html?SearchTerms=domjan

and
Domjan>> and Commissioner of Taxation [2004] AATA 815 (5 August 2004),…[Read more]

The Hart’s case is not about capitalising interest in general. It was about a scheme entered into with the dominant purpose of generating tax deductions.
The appeal is at:
http://law.ato.gov.au/atolaw/view.htm?basic=+harts%20v%20+compound&&docid=JUD/50ATR369/00001

Paragraph, 33 “The fact that the taxpayer had even a dominant purpose of…[Read more]

Thanks Rob

Terryw
Discover Home Loans
Mortgage Broker
North Sydney
Terry@discoverhl.com.au

If there is not growth, then you do not borrow any money to live on. You only can increase your loans at a portion of the growth. you would also only do this strategy with high growth property.

If your properties are continuously growing, then you will have equity. If you have enough equity, you can always get loans.

Steve Navra is another who…[Read more]

Originally posted by Nehal:
hey everyone,
i’d like to discuss about how I could get loan at the age of 18 if i have a temporaray job?

Terryw
Discover Home Loans
Mortgage Broker
North Sydney
Terry@discoverhl.com.au

Yes, watch out. Sometimes documents come out with incorrect addresses etc, and need to be done again. This could cost you $10,000.

Theoretically it would be possible, but things sometimes drag out a bit.

Terryw
Discover Home Loans
Mortgage Broker
North Sydney
Terry@discoverhl.com.au

I am not sure this would be correct. I think anyone can advise on property even without qualifications.

Terryw
Discover Home Loans
Mortgage Broker
North Sydney
Terry@discoverhl.com.au