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loan/accounts

Discussion in 'Accounting & Tax' started by Elives, 31st Mar, 2016.

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  1. Elives

    Elives Well-Known Member

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    i was wondering how most people have the loans/accounts set up

    etc say you have 3+ properties which account do you get the banks to direct debit the repayments from? do you just have 1 transaction account which all direct debits come out of and maintenance, insurance or is it better to have 1 offset account made just for transaction purposes and to make loan repayments.

    or do you have different accounts per property? if so which account? LOC, offset or transaction?

    i'm looking to set up the best account structure for tax purposes and bookkeeping.

    Cheers, Elives
     
  2. Terry_w

    Terry_w Solicitor, Finance Broker, CTA Business Member

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    DD from the PPOR offset. All rent and income into this account.

    Don't use a LOC like this or you will end up with problems.

    See my ideal loan structure at Terryw’s Ideal Loan Structure
     
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  3. Elives

    Elives Well-Known Member

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    Hi Terry,

    i don't have PPOR, but using an offset is the way to go? so all rent and expenses from all properties go in and out of the 1 offset account? i thought this would be easiest but thought i'd ask as from a tax point of view there might be a better option.

    Cheers, Elives
     
  4. Bran

    Bran Well-Known Member

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    I thought you asked how many accounts we have.

    Probably about 25.

    But - what Terry said.
     
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  5. Terry_w

    Terry_w Solicitor, Finance Broker, CTA Business Member

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    Generally where there is 1 of you would would put the offset on the loan with the highest interest rate.

    Where there are 2 of you then individual marginal tax rates come into play. if you have separately owned properties consider putting all money in the offset of the loan in the lower income earner's name.

    but before you do this consider the limit it places on any spousal loan strategies - you cannot borrow your own money.
     
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  6. Elives

    Elives Well-Known Member

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    Thanks terry!
     
  7. Jamie Moore

    Jamie Moore MORTGAGE BROKER - AUSTRALIA WIDE Business Member

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    Keep it simple.

    All repayments come out of one offset account.

    If you have an owner occ - then that offset account.

    If you don't - then use the offset against the loan with the highest rate.

    Cheers

    Jamie
     
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