Hi professionals,
I’m planning to buy an investment property and trying to maximise tax deductibility.
I’m wondering, if for example
1. I have 100K home loan on the main residence (not deductible)
2. Put 100K into redraw account and pull it out for the deposit of an investment property (purpose of the redraw is to invest - deductible)
3. Now 100K home loan secured by the main residence is deductible.
4. Never ever redraw again for personal reasons, as it will reduce the amount of deductible loan.
Is it correct or am I dreaming?
From my understanding redraw is technically similar (same?) to new borrowing, so when I redraw 100K from the main residence for investment (new borrowing), it can be deductible.
If I’m wrong, please correct me with the background information, I want to know the system better.
If I’m right, is there any tips to make transactions clear to avoid any audit?
Just want to make everyone’s life easier.
What I have in mind now is to open a new daily account and use it only for the investment related trasactions.
Thanks in advance, much appreciated!
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