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NSW Name/s on title,Stamp duty, deductibles and loan/s

Discussion in 'Accounting & Tax' started by dabbler, 24th Mar, 2016.

  1. dabbler

    dabbler Well-Known Member

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    So no dice for change of names in NSW from joint to only one of the persons without duty & probably issues with the loans and deductibles too. Better to sell to partner and re finance maybe.

    What effect or negatives are there if a lender requires both to be on loan, but you buy in only one persons name, can all the loan interest be deducted ? or does it need to be noted in loan that one is only a guarantor ...

    The NSW system of treating all as "purchaser" is a real bugger, sometimes I really do wish these things were standard, but wait, then they would all choose to do as the ACT does !
     
  2. Paul@PFI

    Paul@PFI Tax Accounting + SMSF Business Member

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    The loan interest deductibility is determined by :
    1. The loan proceeds borrowed being used to acquire the property; and
    2. Where the parties are spouses / partners than the legal title will determine the deductibility NOT the name/s on the loan. eg : One name of title, tow names on loan then sole owner is assessed on all income and all deductions. If two name/s on title and one borrower then all income / expenses are shared by manner of title.

    There can be concerns if a third party is a co-borrower but not on title and in that case tax advice may be needed and a private ruling sought to ensure deductions aren't apportioned etc. Lenders these days avoid that like the plague just as they avoid guarantees.

    Terry has a thread with tips on + / - of one name on title v's two names of servicing.
     
  3. Terry_w

    Terry_w Solicitor, Finance Broker, CTA Business Member

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  4. dabbler

    dabbler Well-Known Member

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    Thanks guys, I am not sure why, but it always starts to mess with my head in regard to names on things.

    Need to always think, what money/loan is used for is what is deductible, stop thinking about the name and getting stuck on that.

    I think there is no need to separate the income and loan repayment that I can think of, it can come from/go to same joint account as everything else, accountant then just apply to the right person at tax time. Could just as easily keep it separate if there is a good reason ?