0 mortgage on investment property. Redraw on loan available. Can I use the redraw to pay off primary residence and offset against investment property tax?
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1,658 views
1 replies
You can always redraw from your loan but not as a tax dodge. You can’t claim the interest cost as your primary residence isn’t your investment property. So, no.
“Generally, you are entitled to deduct interest charged on an investment loan where the whole of the moneys advanced to you has been spent for investment purposes such as buying a rental property, or a home purchased with borrowed money that has been turned into a rental property.
“However, if you redraw from that loan, then the redraw is treated as a separate loan to you. If you spend the redraw money in a different way to the originally investment related borrowed money then you will have to apportion the interest charged on the loan into deductible and non- deductible parts.”
https://community.ato.gov.au/s/question/a0J9s0000001DxG/p00029949
All replies
You can always redraw from your loan but not as a tax dodge. You can’t claim the interest cost as your primary residence isn’t your investment property. So, no.
“Generally, you are entitled to deduct interest charged on an investment loan where the whole of the moneys advanced to you has been spent for investment purposes such as buying a rental property, or a home purchased with borrowed money that has been turned into a rental property.
“However, if you redraw from that loan, then the redraw is treated as a separate loan to you. If you spend the redraw money in a different way to the originally investment related borrowed money then you will have to apportion the interest charged on the loan into deductible and non- deductible parts.”
https://community.ato.gov.au/s/question/a0J9s0000001DxG/p00029949
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