Hi Dom,
According to my calculation the difference is ‘only’ $10K total (Mr and Mrs) over the three years based on some very rough estimations.
As I indicated in the long comment this saving would need to be balanced out against the potential savings in non-deductible debt interest if you were to sell all properties in one year. Definitely time to sit down with someone who knows what they are doing.
Derek
[email protected]Property Investment Support Available. Ongoing and never stopping. PM welcome.
Hiya Dom
Make careful note of the new tax brackets that are being brought in over the next couple of years….
If you can, I would suggest as Derek said, staggering the sale. The reason for this is as he said, that the taxation can be less.
For instance, if you sold one in July this year, you not only have a year and more before you have to pay the tax, but you also have time to plan how to reduce your income for that year…
As Terry said, you can prepay interest. A plan could be to sell one house, and in June of next year, prepay the interest on your two remaining properties, thus reducing the income for that year. Having prepaid the interest will not stop the bank from discharging the loan if you sell one of them the next month, so that’s not a problem.
It might however, stuff you up for that FY, but again, you’d have a year to sort it out – or two years starting from now….
Is there any reason you ‘have’ to sell all three? Could you not sell one or two, and use the proceeds to pay off the PPOR, and keep paying the same or less payments onto PPOR to reduce the loan quicker? This would also reduce your total out of pocket expenses for the two or one IPs, although still being slightly negative, but that’s ok as long as you have PPOR debt…..
Cheers
MelThanks Mel,
For me to be able to get to this point has been the ride of a lifetime financially.Who would have thought two years ago that i would be in this position to own my home that quickly.Mel i will only need to sell two propertys to pay my PPOR and have cash left over. And that is what i will do and i am not to concerned about the CGT.I consider myself to be a very lucky man to be able to come to this point.And the large amount of interest on my PPOR i would have paid over the 25 year loan far outways the CGT.
And with the extra equity in my PPOR the sky’s the limit. For now my wife and two girls will just sit back and enjoy the extra income.
And i will still have two Positive IP’s. Not bad for a low income earner.
I will keep investing because i enjoy it .Now that money is not a burden life and work will be a holiday.Thanks everyone for your help i could have not acheived this whithout all your help,information,kindness and advice.
Dom [biggrin]
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