Consolidation phase & avoiding CGT

Discussion in 'Accounting & Tax' started by Codie, 9th May, 2018.

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  1. Codie

    Codie Well-Known Member

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    Hypothetically if John smith owned 10m worth of property with 4m debt, let’s say each property is worth 1m with 40% LVR, and wanted to consolidate a couple to reduce debt and potentially increase cashflow.

    Instead of selling any and paying any CGT

    By using an LOC and redrawing back against the IP’s to purchase a PPOR, (let’s say borrows 1m) to then later sell on a year or 2 later - Would this technically wash the 1m of borrowed funds of any CGT?
     
    Codie, 9th May, 2018
    #1
  2. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    No.

    Loans have no bearing on cgt
     
    Terry_w, 10th May, 2018
    #2
    Marg4000 likes this.
  3. Paul@PAS

    Paul@PAS Tax, Accounting + SMSF + All things Property Tax Business Plus Member

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    Nick Petroulis back at work ?
     
    Paul@PAS, 10th May, 2018
    #3
    Scott No Mates likes this.
  4. Scott No Mates

    Scott No Mates Well-Known Member

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    Methinks it's lost on the younger generation.
     
    Scott No Mates, 10th May, 2018
    #4
  5. Mike A

    Mike A Well-Known Member

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    unless you are in the tax industry you have probably never heard of Nick Petroulias.
     
    Mike A, 10th May, 2018
    #5
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