I posted this in the Property section but there were no takers. Do any of the share traders/margin loan investors use this strategy?
I am interested to know if any investors out there with negatively geared investments (particularly largely -ve geared) take advantage of the ATO’s form 2036 which allows you to reduce your PAYG (weekly or f/n) tax from salary by the approximate amount you will get back at years end. The mini tax refund every week.
How has the experience been for you? Have you paid it off your loan and made a big dent?
Polar.
Hi Polar
Yes we fill in the form to vary our tax paid so that we get more take home pay each month. The form is fairly easy to fill out I beleive if you have to pay tax at the end of the year the tax dept frowns upon. The extra money we get in our pay goes straight to our investments usually in a redraw facility on a loan to reduce the amount of interest paid and to store it until we want to buy another investment to use as maybe a deposit.
We figure that we may as well have it sitting on our investment loan rather than the tax dept having it for 12 mths.
ErikaHi polar bear.
in my experience a lot of investors use this arrangement. I used it 15yrs ago to good effect(the name of the form has changed recently – used to be 221D or something like that, which is why others may not have answered).
Use the money as Erika suggests – offset against your PPOR loan if you have one.
TerryTerence McMahon
HomeWin
Finance
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