All Topics / Help Needed! / Your advice needed on my PPOR

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  • Profile photo of luckyoneluckyone
    Member
    @luckyone
    Join Date: 2003
    Post Count: 148
    January 23, 2004 - 1:34 am

    Hello All,
    My other half and I are currently thinking about making some improvements to our PPOR to make our life a little bit more comfortable. We would like to install ducted cooling, a pergola and a deck. What I would like to know is whether or not we should roll these extra things into our PPOR or have a separate mortgage for these things (which wouldn’t cost us anything as we have a professional package where we can have as many loans as we want under the one structure for no extra cost).

    Anyway, the reason I want to know is that we plan to turn this PPOR into an investment property in the next year or two and I would like to make sure that before I put these extra costs into our existing mortgage, that they will all be tax deductable.

    Can someone please help me out.

    Thanks,
    Luckyone

    Thanks,
    Luckyone

    Profile photo of Mortgage HunterMortgage Hunter
    Participant
    @mortgage-hunter
    Join Date: 2003
    Post Count: 3,781
    January 23, 2004 - 3:27 am

    Speak to an accountant.

    I cannot thing of any reason why either of those opstions would make a difference tax wise.

    Remember interest is deductible depending on what the loan was used for. Your case sounds straightforward however I stress that you need to check with the ATO or a tax professional.

    Cheers,

    Simon Macks
    Mortgage Broker
    [email protected]
    0425 228 985

    Comments may not be relevant to individual circumstances. If you intend making any investment, financial or taxation decision you should consult a professional adviser.

    Profile photo of luckyoneluckyone
    Member
    @luckyone
    Join Date: 2003
    Post Count: 148
    January 23, 2004 - 4:32 am

    Thanks Simon. I’m going to see my accountant next week anyway, so I’ll ask him then.

    Thanks,
    Luckyone

    Profile photo of BennyBenny
    Moderator
    @benny
    Join Date: 2002
    Post Count: 1,416
    February 20, 2004 - 1:27 pm

    Hi Luckyone,

    “I would like to make sure that before I put these extra costs into our existing mortgage, that they will all be tax deductable.”

    Something that always confused me were the words “deductability of interest depends on the original purpose of the loan” (or words to that effect). It had me thinking that if you ever rented out your PPOR, the interest would NOT be deductible.

    I have since found this thinking is incorrect, and that, as soon as your PPOR is rented – or available for rent – interest on any remaining mortgage becomes deductible. (The ATO adds the word “generally”, so there might be some circumstances where this does NOT apply). Therefore, I can’t see having separate mortgages are of any benefit. But DO check it out with the usual suspects [;)] (i.e. Accountant)

    Benny

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