Tax complications, (need help)

Discussion in 'Accounting & Tax' started by Jonathan C, 8th Aug, 2018.

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  1. Terry_w

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

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    that answer doesn't make sense.
     
  2. Jonathan C

    Jonathan C Active Member

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    @Terry_w

    I am very confuse even more. So you think I can still redraw that fund from the loan?

     
  3. Terry_w

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

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    It sounds to me like you are trying to artificially increase the interest you can claim a deduction on.
    You can still redraw from the loan, but you should consider the consequences - which the tax agent should have told you about.

    Here is a quote from the private ruling Mike quoted above:

    Part IVA of the Income Tax Assessment Act 1936 (ITAA 1936) is a general anti-avoidance rule that can apply in certain circumstances if you or another taxpayer obtains a tax benefit in connection with an arrangement and it can be concluded that the arrangement, or any part of it, was entered into or carried out by any person for the dominant purpose of enabling a tax benefit to be obtained. If Part IVA applies the tax benefit can be cancelled, for example, by disallowing a deduction that was otherwise allowable.
     
  4. Mike A

    Mike A Well-Known Member

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    now in totally confused. you are concerned about deductibility of $16k remaining ?

    that loan is going to be repaid within maybe a year. are you seriously worried about interest deductibility on 16k for a year ?
     
  5. Jonathan C

    Jonathan C Active Member

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    Yes. that's totally correct.
     
  6. Mike A

    Mike A Well-Known Member

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    16k x 0.05% = 800 x 0.30 average tax rate = 240.

    How much did the accountant charge you ? That might be more than what you are trying to save.
     
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  7. Terry_w

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

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    Lol
     
  8. Jonathan C

    Jonathan C Active Member

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    Are you guys happy making fun like that?
     
  9. Jonathan C

    Jonathan C Active Member

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    Cannot believe when I was so really in need of help. If you could say it a little nicer, it would be great.
     
  10. Mike A

    Mike A Well-Known Member

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    no im not. im being quite serious you are spending money on tax advice for a potential tax saving of $240

    it doesnt make sense to pay for advice when the benefits may not outweigh the costs.

    maybe @Terry_w shouldnt be laughing (that wasnt me). i just cant see the logic here im afraid.
     
  11. Terry_w

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

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    I am confused. Were u trying to increase the deductible debt or not?
     
  12. Jonathan C

    Jonathan C Active Member

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    I did what you told me to do. I find a tax adviser like you said.
     
  13. Jonathan C

    Jonathan C Active Member

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    Which part that makes you think I am trying to do that?
     
  14. Terry_w

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

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    The fact that it doesn't make sense to seek paid tax advice about interest on $16k
     
  15. Terry_w

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

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    Let's look at this differently.

    What question did you seek tax advice on?
     
  16. Mike A

    Mike A Well-Known Member

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    at one point you mentioned the outstanding balance was $96k. that is worth looking into. now its $16k. so different facts would give a different answer.

    the forum is free and advice is general in nature. one should always seek specific legal and tax advice regarding the specificity of their affairs
     
  17. ttn

    ttn Well-Known Member

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    I would do this - redraw 250K and use just enough for property 2 settlement and the leftovers in offset account for property 2 as investment. Dont worry about FHOG for this property

    After next year which you would more likely have another 250K extra savings in offset acct then buy your PPOR home (third property) and get the grant. I cant see any Govt will ever drop off the FHOG incentive ;)
     
  18. Jonathan C

    Jonathan C Active Member

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    Maybe I take it this too serious. Sorry for making it sounds like I was upset. I wasn't ready to be LOL at at the moment.

    Yes, I asked for help. I should be the one who accepted the harsh comments even being laughed at. My mistake, I accepted it.
     
  19. Terry_w

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

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    You won't answer my questions so you must not want help
     
  20. Jonathan C

    Jonathan C Active Member

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    Give me few minutes, I was slow to see lots of messages right now. I just got out of a meeting and I am trying to respond. Let me get to that in few minuttes.