Who claims interest if one name on title but two names on loan

Hi all,

As the subject mentions, if there is a loan where both me and my wife are on the investment loan but the property title just has my name can i just claim the interest paid for tax myself or do we need to do it 50/50. Preference is just on my own but would like to know if that is OK.

 

Taxation Ruling TR 93/32 considers the division of net income or loss between co-owners of a rental property. TR 93/32 states that net income or loss from a rental property must be shared according to the legal interest of the owners, except in those very limited circumstances where there is sufficient evidence to establish that the equitable interest is different from the legal title. Legal interest is determined by the legal title to a property.

TR 93/32 states that where the title deed of a rental property indicates sole ownership of the property, and the mortgage is held in joint names, the legal owner can claim the full amount of the interest paid.

In example 5 of the ruling it states “ The fact that Mr Z has paid all the expenses on the property is of no consequence for income tax purposes. We would simply treat the payment of Mrs Z’s share of the expenses by Mr Z as no more than a loan by Mr Z to Mrs Z.

 

Title does everything