Sell shares already owned, to borrow money and re-buy them?

Discussion in 'Shares & Funds' started by KayTea, 8th Jan, 2021.

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  1. Terry_w

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

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    Just because they could deny the deduction doesn't mean they would.
     
  2. KayTea

    KayTea Well-Known Member

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    But it's a risk, isn't it. It's almost like 'just because the police aren't there to catch me speeding...' justification.
     
  3. Terry_w

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

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    No its not like that at all because speeding is a criminal offence.
    With claiming interest you have a right to claim under s8-1 ITAA97.
     
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  4. KayTea

    KayTea Well-Known Member

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    I was talking more about the choice/decision to speed - just because one might not get caught doesn't mean one should necessarily risk it...
     
  5. B Tilly

    B Tilly Member

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    With shares recently pulling back a bit there may be an opportunity to sell at a loss and debt recycle using a PPOR home loan split.
    My assumption is that this could be seen as a wash sale? Or is it just restructuring to a more tax effective solution?
     
  6. Terry_w

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

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    what is the dominant purpose in selling shares only to buy the same shares back?
     
  7. B Tilly

    B Tilly Member

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    To be able to convert home loan interest into deductible interest. Hence to reduce tax
     
  8. Terry_w

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

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    part Iva can apply to cancel the tax benefit in that case
     
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  9. exp

    exp Well-Known Member

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    "I wanted to sell my VAS which holds the top 300 Australian stocks and buy A200 which holds only the top 200 because I decided I didn't the higher risk of small cap shares"

    Problem solved.

    (unless you are referring to individual shares)
     
  10. Marg4000

    Marg4000 Well-Known Member

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    Can you make it a bit less obvious?

    I mean, borrow some money to buy more shares to begin with? Then, over time, sell down your present shares? Space transactions out and vary amounts so there is no direct connection? You could do it in stages.
     

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