Strategy: Using AMP’s Master Facility to Debt Recycle Debt recycling is the conversion of non-deductible debt into deductible debt while investing. See Tax Tip 2: Debt Recycling https://propertychat.com.au/community/threads/tax-tip-2-debt-recycling.1472/ AMP have an excellent facility which they call the 'master limit'. It allows loans to be restructured without creating a need to reapply and pass a credit assessment. This may be possible with a few other lenders, but as far as I am aware changing to and from a IO and LOC can create credit reassessments because a LOC is generally assessed differently to a IO loan. Westpac and Suncorp are lenders that allow easy splitting of loans and it may also be possible to transfer money directly from the loan accounts. So it may be possible to use these lenders too. Here is a simple example of how it can work with AMP X has a $100,000 non-deductible home loan which will take him years to pay off. He wants to speed up the process by use of the debt recycling strategy. X applies for a loan with AMP and indicates he wants the Master Limit facility – note there is harsher servicing for this. He asked AMP to split it into 2 portions Loan A $80,000 as an IO loan + offset Loan B $20,000 as a LOC X saves up $20k in the offset then pays off the $20k LOC completely using the offset account money. He then borrows to buy $20k worth of shares (or anything producing income) Interest is now deductible on this split X keeps saving in the offset account and now gets his dividends paid into the offset as well. Interest for Loan B is paid from the offset account. Pretty soon X has another $20k saved and does the same thing. Loan A is now split into 2 Loan A $60,000 Loan B $20,000 (already used for shares) Loan C $20,000 to be used to buy more shares Now he has $40k of the original loan deductible and 2 lots of dividends coming in. This speeds up the debt recycling. To speed it up further X could consider periodically selling the shares when they are high. X sells the first lot of share that he bought for $25,000. He pays off the $20k that he used to buy then and has $5,000 left over. He has to pay some CGT but he may be left with $4k. He parks this in the offset and saves even more non-deductible debt. He immediately rebuys more shares (after getting tax advice about wash sales). Even if he bought back the same shares at the price he sold them for he would be ahead. He might even get them cheaper. X could do the same with the second lot of shares too - then he might have $8k extra cash to pay down the non-deductible debt. This considerably speeds up debt recycling. Once X had purchased the shares with the LOC he would have immediately converted the LOC to an IO term loan as the LOC has a 0.15% higher rate. Note that the same debt recycling strategy could be done with buying and selling property Strategy: Buy Sell Buy But the problem with property is that there are high entry and exit costs and expenses meaning the income is often negative. Who can advise on Debt Recycling? Debt recycling itself is not financial advice. There is no need to see a financial planner for advice on the concept. But shares are a financial product so advising on shares is financial advice which can only be given by a financial planner. This includes aspects such as what shares to buy, when to buy and when to sell. This mostly relates to tax issues, whether the interest on the loans will be deductible and only tax agents or lawyers can give tax advice. Financial planners cannot unless they are registered tax agents or lawyers. Brokers can advise on the loan products suitable for something like this. Lawyers generally are not needed – except for the tax advice perhaps. But you might want to get advice on structuring the ownership of the shares. Whether a discretionary trust is suitable for your needs, if so how to get money into the trust etc.