Forum Replies Created

Viewing 4 posts - 1 through 4 (of 4 total)
  • Profile photo of commprop101commprop101
    Participant
    @commprop101
    Join Date: 2003
    Post Count: 4
    September 15, 2003 - 11:43 am

    Thanks Simon for the reassurance. My acct has also backed it up so I’m going ahead. Saves me about 2.45% on my current deal (9% down to 6.55). That’s got to be good.

    Stuart

    Profile photo of commprop101commprop101
    Participant
    @commprop101
    Join Date: 2003
    Post Count: 4
    September 14, 2003 - 11:42 pm

    I’d say it would be a great idea to have a seperate account for the 10% deposit component. Most loans allow these facilites now. Reading the ruling makes me think you can do it without a split facility but it would be a bit messy.

    As to CGT. Can anyone verify that even if the loan facility is on the POPR using a sub-account for investment purposes will not affect the POPR with respect to CGT. I’m almost certain it would not but…

    Stu

    Profile photo of commprop101commprop101
    Participant
    @commprop101
    Join Date: 2003
    Post Count: 4
    September 12, 2003 - 2:42 pm

    Answering my own question, the ATO site has a tax ruling that seems to lay this out exactly as I had hoped (see below). This means to me that I can use one of the accounts on the home loan to take the amount off my current CP loan provider and deduct the int. payments from my rental income. This should not have any bearing on my PPORs exemption to CGT. Your comments mucho appreciado!

    ATO Ruling:

    “Line of credit facilities

    12. Where a line of credit facility is divided into sub-accounts and each sub-account is used for a specific purpose, interest is fully deductible where funds drawn down on an investment sub-account continue to be used exclusively for an income producing purpose. Interest is not deductible where funds drawn down on a private sub-account are used for a non-income producing purpose. “

    http://law.ato.gov.au/atolaw/view.htm?docid=TXR/TR20002/NAT/ATO/00001

    [:D]

    Profile photo of commprop101commprop101
    Participant
    @commprop101
    Join Date: 2003
    Post Count: 4
    September 12, 2003 - 2:25 pm

    +ve cash flows depend on a lot of things.

    Interest rates
    Tenants
    Repairs

    If rates go up to 10% as I heard predicate today. Will you still be +ve?

    I think the key is to lock in the rate when you know it’s a good time. BTW – its a good time!

Viewing 4 posts - 1 through 4 (of 4 total)