Author: choffan(Enthusiast)Enthusiast 8 May 2023
Hi Riley and Bruce,
Thanks a lot for the answers! Well, let's say they put as a condition that there must be (something resembling) a bed ready for them anytime they wish to visit Australia in future :)
In the end, I agreed with my parents to arrange a zero interest rate loan. This is a fairly typical arrangement in my parents' country, and it also makes things clearer with their own tax agency.
I have four residual questions, if possible:
1) Is the zero-interest rate attracting different conditions from what we stated so far?
2) Unfortunately, they are not able to make the transfer in one single go, more likely 4-5 spread across a period of five months. All bank transfer statements will clearly contain the reason of the transfer (a zero-fee loan for purchasing first property) and we are prepared to disclose any relevant documentation. In this sense, what would we need to have? There will be a signed document between them and me, but we are prepared to officialized it as requested by ATO.
3) We found out it is much better if they transfer the money in their currency (EUR) into an EUR account in my own name, then I will do the FX conversion with an Australian brokerage account to save (a lot of) money. Eventually, the money will be stored in an Australian account ready to be used later on. Is that fine?
4) Since the house will be purchase no earlier than December (more likely Feb/March depending on the market) I wish to store the money into a saving account. I understand that this is fine as long of course the interest is declared at the end of the year tax return. Please correct me if I am wrong!!
thanks again, you guys are amazing :)
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