Tax benefits from IP and HECS-HELP debt

Discussion in 'Accounting & Tax' started by Timwest, 15th Jun, 2016.

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  1. Scott No Mates

    Scott No Mates Well-Known Member

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    Isn't HELP just another non-deductible debt & be considered ahead of deductible debt?
     
  2. Greyghost

    Greyghost Well-Known Member

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    1.@Perthguy what he said.
    2. Servicing issues
    3. Reduced cashflow on additional withholding.
    4. You received the benefit of upfront education, so pay it back.

    I was agreeing with you on the basis of funds can be better utilised, but why avoid something that will need to be paid regardless
     
  3. Scott No Mates

    Scott No Mates Well-Known Member

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    My opinion too!
     
    Joynz and Greyghost like this.
  4. Perthguy

    Perthguy Well-Known Member

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    To make use of low indexation, which is lower than a loan interest rate. $10k will be paid back soon enough under required deductions. No point paying more than required when the funds can be put to better use. Why would you not put your limited funds to the best use?
     
  5. Greyghost

    Greyghost Well-Known Member

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    Non deductible home loan vs non deductible help debt. Although the funds are better used against home loan due to interest rate differential, help debt has withholding against it which affects servicing and your weekly cashflow. So if you are in the final couple of years of repaying help it can be like a bandaid, pull it off quickly. If the debt remaining is stretching over 5 years still it is a different story.
     

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