Debt recycling and tax free thresholds

Discussion in 'Investment Strategy' started by Mr_Cr7, 9th May, 2020.

Join Australia's most dynamic and respected property investment community
  1. Mr_Cr7

    Mr_Cr7 Member

    Joined:
    9th May, 2020
    Posts:
    6
    Location:
    Melbourne
    Hi all, first time poster.
    I'm interested in using debt recycling to pay down my ppor and will take out some equity in my home to invest into the sharemarket and start the cycle (currently at 50% lvr)

    My wife is currently a stay at home so mum so I am curious if there are any ways to utilise her 18k tax free threshold using this method otherwise i will just deduct any interest accrued from the loan from my taxable income. Any suggestions would be great!
     
    Mr_Cr7, 9th May, 2020
    #1
  2. Ko Ko Naing

    Ko Ko Naing Well-Known Member

    Joined:
    10th Aug, 2015
    Posts:
    619
    Location:
    Melbourne
    @Mike A is the person who can legally help you out with this. Anything related to taxation, he is the man. :)
     
    Ko Ko Naing, 9th May, 2020
    #2
    Mr_Cr7 likes this.
  3. Mr_Cr7

    Mr_Cr7 Member

    Joined:
    9th May, 2020
    Posts:
    6
    Location:
    Melbourne
    Thank you kind stranger I will send him a message :)
     
    Mr_Cr7, 9th May, 2020
    #3
  4. Terry_w

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

    Joined:
    18th Jun, 2015
    Posts:
    41,922
    Location:
    Australia wide
    The trustee of a discretionary trust could invest and distirbute the income to your wife. But lots of tax issues, especially with trusts and franking credits to get some advice - MikeA knows this area well.
     
    Terry_w, 9th May, 2020
    #4
    Mr_Cr7 likes this.
  5. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

    Joined:
    14th Jun, 2015
    Posts:
    10,629
    Location:
    Gold Coast (Australia Wide)
    Who be your lender ?

    ta
    rolf
     
    Rolf Latham, 10th May, 2020
    #5
  6. Mr_Cr7

    Mr_Cr7 Member

    Joined:
    9th May, 2020
    Posts:
    6
    Location:
    Melbourne
    At this stage depends on who will lend to me, my broker has told me ANZ, who I'm currently with, won't let me get any equity out.
     
    Mr_Cr7, 10th May, 2020
    #6
  7. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

    Joined:
    14th Jun, 2015
    Posts:
    10,629
    Location:
    Gold Coast (Australia Wide)
    Ta

    Coz of equity or serviceability pls ?

    ta
    rolf
     
    Rolf Latham, 10th May, 2020
    #7
  8. Mr_Cr7

    Mr_Cr7 Member

    Joined:
    9th May, 2020
    Posts:
    6
    Location:
    Melbourne
    Serviceability
     
    Mr_Cr7, 10th May, 2020
    #8
  9. Terry_w

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

    Joined:
    18th Jun, 2015
    Posts:
    41,922
    Location:
    Australia wide
    ANZ are not such a good lender for debt recycling, but it is possible. Look at my simple loan structuring strategy which I have implemented for a client with ANZ.

    Tax Tip 13: Simple Loan Structuring Strategy Tax Tip 13: Simple Loan Structuring Strategy
     
    Terry_w, 10th May, 2020
    #9
    Mr_Cr7 likes this.
  10. Mr_Cr7

    Mr_Cr7 Member

    Joined:
    9th May, 2020
    Posts:
    6
    Location:
    Melbourne
    Thanks Terry

    Will read through that, in your experience which lenders do you find are most accomodating to debt recycling? And do you know of any lenders that have softer lending requirements than Anz?
     
    Mr_Cr7, 10th May, 2020
    #10
  11. Terry_w

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

    Joined:
    18th Jun, 2015
    Posts:
    41,922
    Location:
    Australia wide
    AMP and Macquarie are the best two I think. Softness will depend on the circumstances.
     
    Terry_w, 10th May, 2020
    #11
    Mr_Cr7 likes this.
  12. Mr_Cr7

    Mr_Cr7 Member

    Joined:
    9th May, 2020
    Posts:
    6
    Location:
    Melbourne
    Cheers mate will check them out also
     
    Mr_Cr7, 10th May, 2020
    #12
    Terry_w likes this.
Free Property Depreciation Calculator

Property Investors! Ready to Pay Less Tax? Estimate how much Property Depreciation you can claim on your Investment Property. Washington Brown's calculator is the first calculator to draw on real properties to determine an accurate estimate.