Thanks guys,

All borrowings would be for investiment purchases only. My IP1 would have an IO loan, I intend to then take out an LOC on that same property for a deposit on the next property IP2. This seems to be covered in the answers provided.

For the LOC on IP1, do I have to account for the seperate interest payments that are occured as a result of using LOC on IP1 for a deposit on IP2 (ie seperate tax schedule for 2 loans against the same property, the IO for IP1 and the deposit for IP2). Or, can both the interest for the IO for IP1 and the deposit for IP2 (both borrowed against IP1), by claimed against IP1 for simplicity?

My intention is to use capital growth to replicate to the next property. I am trying to get my financials set up correctly so that i don't run into bank trouble later on when i decide to use my equity for more purchases.

Many thanks.