Thanks all.

I’m still confused though. Based on the clause that Terry mentioned, does that mean I should only be paying CGT on that initial 3 months where there was a tenant from the lease rolled over from the previous owner? Even though it was rented out again after I had lived in it for a year?

Hi Terry, thanks for reply.

Yes, my accountant said I can claim a partial exemption for the 1 year that I lived in it but that is it… I can’t claim the time I was over in London or afterwards. Whereas if I moved in straight away I would be 100% Capital Gains Tax Exempt for the full ownership period.

Thanks Den,Appreciate your response. The vacancy rates and interest rates can be easily altered to identify different scenarios.. I was more hoping to get a feel for the methodology I am using in working out whether an investment is worthwhile and that my method of calculating the tax deductions and net position is correct.

Please explain? How do you exclude interest when interest repayments are one of the biggest factors in property? Similar to tax

Agreed Catalyst… I'm learning the expensive way!Richard, I am single and own the property in my name only.

Damn that is quite annoying…The reason I asked the question is that my PPOR at the moment is the property where I have paid down loan to $300k, however I would like to buy a new PPORy to live in and then rent out my current PPOR. Is there a better method of doing this or is that extra $180k locked away in my current PPOR?

I see.. so putting away all my funds in my 100% offset is not ideal. With the 70k I have in the offset account this should all go straight into the loan on my PPOR, paying it off (leaving some $ for emergency/living funds ofcourse). Then when I need access to this, for eg share investments or deposit for IP, I apply for the LOC. Understand.

Thanks Richard/Terry, great advice.. its things like this (tax benefits) which I am yet to fully understand so I appreciate the responses.In saying that, I should be able to use the equity in my PPOR (approximately $180k) to take out a LOC and use it for the deposit and acquisition costs of my first IP, and the interest paid on this LOC is tax d…[Read more]

Thanks…and how does it work if I do rent out one room in terms of tax deductions and capital gains? This is my plan.1) Live in property 6 months get FHOG.2) Then rent out one bedroom at $200 per week for 5 years3) After 5 years, rent out whole apartment and I'll buy another PPOR.Firslt, current repayments are $2000 and so at $200 rent per week…[Read more]