Forums / Getting Technical / Legal & Accounting / Claiming LMI on an IP

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  • Profile photo of RMAARMAA
    Participant
    @roslyn77
    Join Date: 2004
    Post Count: 21

    Hi all,
    Is anyone able to give me some insight? I’m aware that you can claim LMI on an IP as borrowing costs over 5 years but how does it work if it was originally a PPOR then is turned into an IP within that time?
    Also if you refinance, and are not required to pay it with the new lender due to CG, can you still claim the original amount paid with the old lender?
    Have asked my accountant but have been waiting quite a while for an answer.

    Thanks,

    R

    Profile photo of Ethan TimorEthan Timor
    Participant
    @ethantimor
    Join Date: 2016
    Post Count: 282

    Have asked my accountant but have been waiting quite a while for an answer.

    Might be time to change an accountant?

    Ethan Timor | Aligned Finance Pty Ltd
    http://www.alignedfinance.com.au/
    Email Me | Phone Me

    Active Investor & Broker; Based in Northern NSW, servicing Australia wide; Author of '34 Proven Ways to Maximise Your Borrowing Power' (download free from our website)

    Profile photo of RMAARMAA
    Participant
    @roslyn77
    Join Date: 2004
    Post Count: 21

    Absolutely.
    I’m on the lookout but the time of year has killed me for that.
    We have some foreign investments that seem to have stumped them as well. Been waiting since Melbourne cup day for a response on that one.
    Might be another direct call to the ATO is in order but then I’ve been waiting for them since Julyish too. 😜

    Profile photo of TerrywTerryw
    Participant
    @terryw
    Join Date: 2001
    Post Count: 16,190

    If you move in you can claim lmi on the remaining 5 years.

    If you discharge the loan you can claim any remaining lmi unclaimed in that year of discharge.

    Terryw | Structuring Lawyers / Loan Structuring Pty Ltd
    http://propertytaxbook.com.au/
    Email Me

    Lawyer, Mortgage Broker and Tax Advisor (Aust wide) http://propertytaxbook.com.au/

    Profile photo of RMAARMAA
    Participant
    @roslyn77
    Join Date: 2004
    Post Count: 21

    Thanks for the reply Terry.
    We discharged around Jan 15 but moved in during the 13/14 FY (passed the 2 years for amendments) and about to make IP so i’m guessing that we’ve missed out on the ability to deduct any of the lmi cost.
    I wish my accountant had given us better instructions/advice.

    Profile photo of TerrywTerryw
    Participant
    @terryw
    Join Date: 2001
    Post Count: 16,190

    Thanks for the reply Terry.We discharged around Jan 15 but moved in during the 13/14 FY (passed the 2 years for amendments) and about to make IP so i’m guessing that we’ve missed out on the ability to deduct any of the lmi cost.I wish my accountant had given us better instructions/advice.

    If it was less than 60 months since you took the loan and incurred the LMI then part of it may be deductible in the 2015/16 financial year – as long as it was rented at this time.

    Terryw | Structuring Lawyers / Loan Structuring Pty Ltd
    http://propertytaxbook.com.au/
    Email Me

    Lawyer, Mortgage Broker and Tax Advisor (Aust wide) http://propertytaxbook.com.au/

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