- PuglyMember@puglyJoin Date: 2009Post Count: 10
I realise this has probably been covered in past forums and I am going to be seeing a property lawyer specialist in the coming weeks regarding this matter, but I thought I might get some information from his forum that might give me some food for thought so to speak.
Heres my situation.
I am married and we have an IP soley in my wifes name that she fully owns worth about 700k that we bought for 630k that currently rents very well.
We have recently moved from our previous PPOR which we still have a small mortgage on but are now renting out also at very good yields to a new house in which we have a Mortgage on of about 450k.
Ideally what we want is to pay off our current PPOR ( Mortgage of 450k ) but obviousley keep the IP that my Wife fully owns due to its high rental reurns. Can my Wife legally sell me that house so we can fully pay of our PPOR, as we all know that you cant claim any deductions on your PPOR.
What we want to achieve then is obviously no debt on our PPOR but debts on our high yielding IP properties. I just want to know the best steps to take from here so we can start moving forward to eventually buying furthur properties.TerrywParticipant@terrywJoin Date: 2001Post Count: 16,213
Yes she can. But CGT would be at market rates and stamp duty would also probably be at market rates. However, you should ask a tax expert about the ATO and part IVA (may disallow it if the dominant purpose was to save tax).
You may also want to look at the wife selling you just half of the house as in some states this may entitle you to transfer without stamp duty. And/or transfer half now and half in another financial year to reduce the CGT.
Also consider the use of a discretionary trust.PuglyMember@puglyJoin Date: 2009Post Count: 10
Righto, will take that on board, thanks for your help TerryAtwaterParticipant@atwaterJoin Date: 2011Post Count: 3
I am new member and this is really valuable information about the mortgage .This is helpful for other members too.Te suggestion of selling the half this time and the remaining in another year is a good deal to reduce CGT.Thanks.TerrywParticipant@terrywJoin Date: 2001Post Count: 16,213
It would be a bit of a hassle with the lender and the conveyancing, but you could do 10% per year for 10 years even!
BTW, if the house was owned by a company as trustee for a unit trust then you could just transfer a few units each year without any stamp duty and without changing the name on title.