G'day..
When I bought my second IP late last year I redrew $10,000 from my first IP mortgage to pay a deposit on the 2nd IP. This $10,000 was the extra repayments I made on my mortgage over the minimum repayments. Is this $10,000 tax deductible because I have used it to purchase an investment property? Any help would be much appreciated. Cheers
tuggerwaughHi tuggerwaugh
The interest on the " $ 10,000 " used for a deposit on 2nd IP purchase should be tax deductible. The tax office follows the flow of the money and the intention of the purchase which in your case is for an investment asset. I am assuming that there will be a rental income from this 2nd IP and that you've not purchased raw land.
Confirm all this with your accountant.
G'day Michael..
Yeah the second IP was a rental and has been rented since October…. thanks for that… Our 1st Tax person we saw last financial year didn't do any of the stamp duty or LMI from our 1st property… are we able to claim that this financial year? cheers
tuggerwaughHi,
I recommend you read this site: http://www.propertyinvestment.net.au/tax-deduction.htm
Stamp duty is a capital cost and added to the value of your property. Lender's mortgage insurance is a borrowing expense and can be written off over the shorter of the life of the loan or 5 years.
Cheers,
Steve McKnight | PropertyInvesting.com Pty Ltd | CEO
https://www.propertyinvesting.comSuccess comes from doing things differently
You must be logged in to reply to this topic. If you don't have an account, you can register here.
