Hi All,
Just after some advice on my current situation:
I have a unit that was my previous PPOR I owe 70k on it. It is currently rented for 270pw and has been recently been completely renovated. I would like to hold on to this place as it is in a very good location.I was wondering if I could sell this property to my spouse as it is currently in only my name. Use the funds from the transaction to pay down our current PPOR and maximise the tax benefits on the unit.
I understand there would be stamp duty costs associated , but believe the benefits will out way the costs over a period of time.I would love to hear from anyone with their advice/opinions.Thanks in advance
NOS1NOS1
Nothing to stop you.
But what price are you going to sell it for, you may also be up for CGT etc.Maybe you could sell half to your spouse to reduce costs ?
Hi WJ Hooker,
Similar places have fetched around the 300k mark recently. I was thinking of selling it for 250k.
We moved out of the place about 2 years ago, so I was under the impression that i wont be up for CGT.Cheers
NOS1NOS1
re CGT. Unsure of your position, but you can only have one PPOR at a time, so if you currently live in another house thats yours then CGT is payable ( you can say which house has the less gain for CGT ). Or if you are renting then there is no CGT.You will need to get a valuation done on the house if you sell it to you partner as this will be your CGT starting point again, you cannot sell for less than the market price at the time and then put in a higher starting point for CGT!
good luck
You mentioned you have a current PPOR, so the old PPOR will be subject to CGT. The CGT will be apportioned, however, to the CGT attributable to from the time you bought the new place to when you sell, relative to the total ownership period of the property. Also, you will most probably be entitled to the 50% CGT discount.
Yes, that will be a good way of "refinancing" to maximise your tax-deductible debt. The extent of the benefit will depend on your spouse's marginal tax rate though. Don't forget once you shifted the rental property to your spouse, you will no longer benefit from any negative gearing benefits because the property would no longer be in your own name.
Eddie
[email protected]Thanks for the feedback, just another query. If the place is valued at 300k can I sell half to my wife for 150k , and she claim the 150k as a deduction. As well as i claiming the 70k that I already owe.
We are currently renting ,but have a property with the tenants in it. This will be our PPOR in approx 10 months when the tenants lease expires.So if we do go ahead I will do this whilst we are renting to avoid CGT.
Is this a sensible strategy.NOS1 wrote:Thanks for the feedback, just another query. If the place is valued at 300k can I sell half to my wife for 150k , and she claim the 150k as a deduction. As well as i claiming the 70k that I already owe.We are currently renting ,but have a property with the tenants in it. This will be our PPOR in approx 10 months when the tenants lease expires.So if we do go ahead I will do this whilst we are renting to avoid CGT.
Is this a sensible strategy.Firstly, your wife can not claim the purchase of the house, or half of the house, as a deduction. Do you mean a loan for $150k?
Secondly, generally you would not pay any CGT when the property becomes your PPOR, but as Eddie said above, you can only have one PPOR at a time. I'm unsure exactly of your situation, as earlier you said you had a current PPOR, and here it says you are renting.
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