1st property as PPOR or investment?

Hi everyone,
I'm planning to buy my 1st property in Aus. I'm a sole trader and renting at the moment. I'm more inclined to buy investment until a good deal for PPOR. My questions are:

1. Can I get mortgage as PPOR (cheaper rates) but use it as investment for tax purposes (I don't want PPOR since it takes away my tax deductible from my sole trade business); or

2. Alternatively, I may choose to buy the property under a trust then lease from the trust. Can I claim tax deductible from the rents paid to the trust?

Thank you so much for your eye opening advice!
Cheers

 

if you are operating a business from your house you can claim a tax deduction for the rent paid. However simply having a converted room for paperwork is probably not sufficient to show that your rental is a place of business.

You should give a lot of thought about putting an investment asset into a trading trust.

You might give thought to buying a home, making it your home and then turning it into an investment property. That way you will get tax deductions and your main residence.

 

Trust arrangement for paying rent. No. The ATO takes a dim view in most cases of related party rental. The Janmoor case is often considered by some as being permissive but the opposite is true. And if the trust inst structured correctly perhaps no interest deduction. Also neg gearing may be trapped in trust

Personal tax advice is good idea.

I also dont get the highlighted comment above.

 

Thank you Ross & Paul very much!

 

Hi everyone again,

How can ATO determine an investment income? If I rent out myself, not through agents, with lease agreement and bank transfer of rents, is it consider proper investment?
Tks