How shall I calculate interest deduction for IP?

Hello everyone, much appreciated if you can kindly help with my situation:

I bought my ppor (cost is 600k) in July 2014 with a one-year fixed loan (after one year the loan will become a variable rate one), mortgage was 480k, interest rate was 5%.

One year later in July 2015 when the fixed rate period has passed I refinanced the loan to a variable one, the ppor was revalued at 620k, the mortgage became 496k, the released equity of 16k was put to the offset account. New interest rate is 4%.

Another year has passed in July 2016 I turned the ppor into a IP. I’m a bit unsure how should I calculate the interest deduction for this IP? Should I use 480k*4%? How about the money in the offset account?


Another problem is, when I lived in the ppor, I rented out the car space for 200 per month, can I still enjoy the 6 year absent rule given I used the ppor for profit (although the profit is very small.)


Many thanks for your collective wisdom in advance!

 

There should be no 2016 tax impacts as the property was a main residence
The garage income is assessable income...Perhaps some deductions based on apportioning ?

In 2017 if the offset is used ($16K) then apportioning of the loan into two purposes may be required

The receipt of income does affect a 100% CGT exemption in the future.

 

Mixed purpose loan
480/496 x 100 = 96.77%

97% should be deductible assuming it is IO and no other withdrawals or deposits were made.

 

Many thanks Paul and Terry.