PPOR to IP, no offset, only redraw

Isn't that what he said?

 

I thought they owned it 50/50. One party, A, would gift 50% to the other party,B. A would then buy 100% Off B via a loan with offset. B would place cash into offset until purchase of next PPOR. current ppor becomes investment with loan that is claimable.

 

Stamp duty two more times if that happens

 

Oh wow. Cheers for clarifying that.

 

Hot Topic: Does your relative pay stamp duty if you transfer a property to them? | State Revenue Office

as partners stamp duty exempt?

 

Who should I seek advise and clarification?
Tax accountant?
Do they give written advice (for a fee, of course)

 

Depends what you want clarified. Only lawyers can advise on stamp duty, both lawyers and tax agents can advise on income tax.

 

So if i buy a ppor and then after a few years decide rent elsewhere. I can’t covert the property into an IP later to have interest deductible?
Or is having an offset the only way around this?

 

No. Not sure where you got that from but if the loan relates to the property the interest would be deductible once it was rented.

 

Provided the borrowed funds were used to construct, purchase or maintain the dwelling the renting will mean that from that date :
1. The costbase will reset to the market value on that date for CGT purposes
2. If you dont reside in another dwelling you (or spouse) own then the 6 year absence rule might apply; and
3. The loan interest, along with other ownership costs, would commence to be deductible. Past LMI etc could even be partially deductible too.

 

So that's only if I redraw from the existing ppor to buy the next ppor the interest is not deductible. If I move out and rent a house as ppor and also rent out my existing ppor then the interest is deductible?

 

Interest is deductible if it relates to the purchase or improvement of an income producing asset.
So if you borrowed against your house to go on a holiday and you move out of hte house the interest won't be deductible./
But if you borrow to buy and house, and have no redraws, then the interest might be deductible if you later rent out that house.

 

Because I am potentially going to buy a PPOR, live in it, after a period of time I may move out to rent another place. Then rent my out as an investment property. I wanted to know if I could get access to the 7 year PPOR rule for this property. And if I move out, can I deduct interest payments from the loan incurred after date of moving out?

I understand if I move from 1 PPOR to another which I or spouse owns the 7 year rule won't apply to the same property.

Cheers

 

There is no 7 year rule. You might be referring to the 6 year rule? This only relates to CGT and doesn't change deductibility of interest.

Get some proper tax advice

 

Yes you are correct. But I am still wondering if tax is deductible on interest in the situation I described.

 

Whether you use the 6 year rule or not has no affect on deductibility of interest

 

I understand, I'm just asking for clarification for this part

 

I've answered that several times