I haven’t seen the draft legislation, but my understanding is no travel will be claimable from a certain date – 1 July possibly.

1. Assuming Part IVA is not used by the commissioner to deny the deduction, and you structure the legal documentation correctly it would be $150k plus $45k

2. Yes, but you should use a lawyer as many other legal issues.

3. are you licenced, ABN and insured?

Simon D wrote:

Interesting topics. At broker’s advice, about 7 years ago, I take the portfolio loan from bank of melbourne (line of credit), interest only loan but without any time limit. However, the charge is that you have to pay higher interest rates. I am thinking how can I reduce the interest rate with bank without change the structure.

The only time you should use a portfolio loan is to access equity temporarily. Once it has been drawn down it would be best to convert the loan to a term loan interest only. Lower rate and less risk.

There are several things you could do
a) claim the 6 year rule on the current main residence when you move out. It could be totally cgt exempt.

b) rent the current one out and get the cost base reset to market value at this time and then later sell. Probably minimal to no CGT on this one

c) pay CGT on the existing and then treat the new one as the main residence for up to 4 years prior to moving in.

You just have to weigh up which would be better for circumstances.

If it is being held on capital account then your accountant is correct. You cannot claim the main residence exemption under after it becomes the main residence.

How you would do it is to borrow 80 or 90% of the new property and for the remaining costs you would set up a new loan against your main residence.

You would want to restrict it to a specific property and amount.

Why do you want to give them a POA?

The second option would likely involve paying LMI. No point in paying this if your serviceability will run out before your equity.
.

If serviceability later improves you can always borrow against these properties further and incur lmi then if need be.

Very interesting Benny.

This is the first time that I had heard of this so I just made a spreadsheet to test it out and I got similar results. Very interesting.

My results were
$1 double 20 times becomes $1,048,576.

$1 doubles 20 times with 30% tax on the income component becomes $40,642

Disregard whatever value an agent attributes the property for 2 reasons – a) they will exaggerate to get a listing and b) they are not valuers.

I would suggest you get a valuation done.