Yes gift him $20k extra so you can borrow $20k extra could be a good idea – but get tax advice, especially on Part IVA

In that case you would want to borrow as much as you can and you should get some tax advice about how to maximise the loan (in conjunction with advice from your mortgage broker). I don’t really understand what is going on from your post.

If you have $20k to give your dad why not just use that yourself?

Guarantor

Why do you need to contribute $20k? Is it because of servicing or because of security?

Did you record their conversations without them knowing? This could be a criminal offence.

What does the contract say about the refund of the $1000. It probably don’t matter whether they said it was refundable or not.

Department of Fair trading would be the department to complain to about this as they regulate agents and not ASIC – were you…[Read more]

It could be CGT exempt for your daughter – but the rest of the owners will be liable for CGT – if there was a gain.

why do you say that?

Interest on money borrowed to pay interest can be deductible – This was said in the High Court case of Hart. The ATO even admit it is deductible if the underlying interest is deductible.

But Part IVA ITAA1936 can be used to deny the deduction if it is a scheme with the dominant purpose of making or increasing a tax deduction.

So what is your…[Read more]

Taking money from redraw is new borrowings. The purpose of the original loan was purely to acquire the property (assuming you have made no increases and never redrawn). If you redraw the purpose of that new loan is to pay interest. If the interest on interest is deductible then it all relates to the same purpose – the property. But if the interest…[Read more]

Taking money from redraw would create a mixed purpose loan.

SB – have you had tax advice on number 2?

This would involve borrowing to pay interest. Interest would be deductible under s8-1 normally, but considering the ATO’s ruling on this they may apply Part IVA to deny the deduction.

Also from a loan point of view there would be few lenders that would allow a loan to capitalise like this without it…[Read more]

If you want to pay 3 properties off quickly why not buy 6. Wait for some growth and then sell 3 and use the proceeds to pay off the other 3. Live in one that you intend to sell and sell this CGT free for some extra benefits.

Asset protection is legal advice. See a lawyer. Accountants dont know about various aspects such as the bankruptcy act conveyancing act and other legislation as well as the laws of equity.

You can have good asset protection and be able to claim negative gearing benefits. But it will all depwnd on your situation and what you are trying to protect…[Read more]

It depends. If the property is currently an ip and will remain so then it should be deductible in full in the year incurred.

Actually I am not sure. I think the NCCP may apply to any natural person borrower.

You entered a contract and didnt read it? And then blame the other party?

Did you ask the insurer about malicious damage? Did you seek legal advice before entering the contract?

No lender will lend baeed on rental income only where the NCCP applies as it would be a breach of the act.

Sounds like you may have been acting as trustee for him. If you can prove the trust relationship there may be nominal duty and no cgt event.

If you cannot then there will be duty on the value transferred. It would also be a cgt event.

Younwill need to discharge the mortgage and reapply for a new loan. Consider issues with deductibility of…[Read more]

Sorry Patrick.

For those complementing just make sure you get independent legal advice on this before implementing.

I am located in Sydney.