I found the book on sale ($2) about 6 months ago, and it has sat on my self since then. I’ve just started reading it, and it is not bad so far.

Terryw
Discover Home Loans
Parramatta
[email protected]
Sign up to my mailing list.
Just send me a blank email, with “subscribe” in subject line.

Yes it may be possible, depending on your income etc.

You could reduce your repayments by one or more of the following:
– increasing your loan term
– changing to IO
– finding a cheaper interest rate

Terryw
Discover Home Loans
Parramatta
[email protected]
Sign up to my mailing list.
Just send me a blank email, with “subscribe” in subject line.

It is still possible to find cashflow +ve property in major cities. In the past few years at least 2 of my clients have found them in Sydney.

I would be very wary of buying in ‘bad’ areas just because they are cashflow positive.

Terryw
Discover Home Loans
Parramatta
[email protected]
Sign up to my mailing list.
Just send me a blank email, with “subscribe” in subject line.

Hi Carl

My non accounting opinion is that capital losses can be carried forward until offset by a capital gain. I don’t think there is a time limit.

However, for a trust to carry forward a loss various requirements must be met before the loss can be claimed.

You must look into the trustee making a Family Trust Election. see http://www.ato.gov.au/businesses/content.asp?doc=/content/40272.htm&page=1#H2

BTW, if your trust does have a loss, it may be worthwhile setting up a new trust for future assets so the gains can be strategically distributed instead of automatically being offset by the loss.

Terryw
Discover Home Loans
Parramatta
[email protected]
Sign up to my mailing list.
Just send me a blank email, with “subscribe” in subject line.

Hi Barb

The Hart’s case involved a certain loan product which was classed as a scheme to avoid tax – hence Part IVA applied. It was done with the dominant purpose of obtaining a tax benefit. It was a case involving investment loans – not about borrowing business expenses.

I have been advised that it is still possible to do something similar if you set it up differently. ie you can borrow to pay business expenses including interest and the interest on interest will be deductible.

Terryw
Discover Home Loans
Parramatta
[email protected]
Sign up to my mailing list.
Just send me a blank email, with “subscribe” in subject line.

Hi Don

We are about to knock it down and build a duplex. It is a bit too old. Beleive it or not, none of the units have a bathroom – just a toilet.

Terryw
Discover Home Loans
Parramatta
[email protected]
Sign up to my mailing list.
Just send me a blank email, with “subscribe” in subject line.

A few years ago, a friend of mine purchased a unit in Shanghai, right in the city. It was positive geared from day one and since then has more than doubled in value. She reckons there are still some cheap bargins out there, but you have to be careful of the area as many places in Shanghai have already boomed.

Terryw
Discover Home Loans
Parramatta
[email protected]
Sign up to my mailing list.
Just send me a blank email, with “subscribe” in subject line.

Hi

I beleive each trust has to be exactly the same as the original – otherwise the ATO may deem new trusts to be established.

You had better seek good legal advice on this. Brett Davies talks about trust splitting in his newsletters sometimes – and claims a 100% success rate i think. see http://www.lawcentral.com.au

Terryw
Discover Home Loans
Parramatta
[email protected]
Sign up to my mailing list.
Just send me a blank email, with “subscribe” in subject line.

Hi Donald

Simon has answered, but I might just add that if you use a LOC for investment purposes it can still be promblematic. Every deposit you make is a repayment. So when you withdraw funds it will be classed as new borrowings.

If you only ever withdraw funds for investment/business purposes then the whole interest charged would be deductible, but it could be messy apportioning it between your various investments.

Terryw
Discover Home Loans
Parramatta
[email protected]
Sign up to my mailing list.
Just send me a blank email, with “subscribe” in subject line.