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Tax deductibility of interest question

Discussion in 'Accounting & Tax' started by HappyCamper, 23rd Aug, 2016.

  1. HappyCamper

    HappyCamper Active Member

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    I refinanced a loan a couple of years ago to access equity and make my next purchase. After making the purchase, there were some funds leftover which I put back into the redraw of the loan. If I were to use this money to purchase shares, would the interest payments on those funds remain tax deductible? The problem is that my share trading account has my own funds in there.
     
  2. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

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    I'm not a tax guy but I'd suggest you strip the trading acct of personal tax paid can before you move the borrowed fund across.

    Then soak up all the borrowed money before moving any savings back



    Ta
    Rolf
     
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  3. Terry_w

    Terry_w Solicitor, Finance Broker, CTA Business Member

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    It could be deductible if you borrow to purchase income producing shares. But try to split the loan if you can.
     
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  4. HappyCamper

    HappyCamper Active Member

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    Thanks for the comments. Easy fix in the end. I just opened a second trading account and will transfer the funds there for the share trade. No mixing of funds.
     
  5. Terry_w

    Terry_w Solicitor, Finance Broker, CTA Business Member

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    But if it came from the one loan it would be mixed.