Paying pre-settlement costs - from where?

Discussion in 'Accounting & Tax' started by DBD, 11th Jun, 2017.

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  1. DBD

    DBD Active Member

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    Hoping someone can help with a specific question.

    For my first IP, I have set up a loan structure along the lines of Tery's ideal structure thread - i.e. one LOC loan to cover the deposit + costs and a second loan to purchase the property.

    My question is - can I use the LOC to pay for other pre-settlement costs such as conveyancing fee, B&P inspection, or is this only acceptable for the house deposit?

    I wasn't sure that these additional costs would be considered tax deductible as the purchase has not actually been completed. Hope this makes sense!
     
    DBD, 11th Jun, 2017
    #1
  2. Terry_w

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

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    Yes use the LOC for these costs.
     
    Terry_w, 11th Jun, 2017
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  3. DBD

    DBD Active Member

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    Great thanks Terry
     
    DBD, 11th Jun, 2017
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  4. Paul@PAS

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

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    All costs to acquire etc can be paid from borrowed funds.
     
    Paul@PAS, 13th Jun, 2017
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