Tax minimisation on a positively geared property

Discussion in 'Investment Strategy' started by Sam_rwd, 15th Apr, 2020.

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  1. Sam_rwd

    Sam_rwd Member

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    Hi All,

    I have tried to search for the answer to this question on the invaluable forum, however could not find this particular scenario. Hence the post:

    What would be the best way to transfer a positively geared investment property from the husband (higher income tax bracket) to the wife (lower income tax bracket)?

    The main objective is to minimise tax.

    I am also looking at increasing the loan on this property (equity release) to buy another investment property - which would be negatively geared. If it remains on my name, it will likely offset the profit currently made.

    OR are there any other options? that I have not considered

    Happy to be pointed to some existing posts which I may have missed.

    Thank you in advance.
     
  2. Trainee

    Trainee Well-Known Member

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    Transferring from one spouse to another would likely incur stamp duty and capital gains tax.
     
  3. Terry_w

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

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    Sell it at market value with the wife borrowing 105%
    But get tax and legal advice first

    Full duty and cgt
     
  4. Beano

    Beano Well-Known Member

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    Have you considered getting a divorce and she takes the property ? :)
     
    bunkai and 1961 like this.
  5. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member

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    Capitalise cost other than Interest

    Pls seek tax and credit advice

    ta
    rolf
     
  6. doublebrick

    doublebrick Well-Known Member

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    Given the current covid tenant hardship, wouldnt reducing your rent turn your positive IP into negative (or at least neutral) territory anyway?
     
  7. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member

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    Many tennanst still have capacity to pay.

    Oddly, those on primarly benefits are now gold star

    ta
    rolf