I took out a $100,000 loan with my bank, to pay for upfront costs (stamp duty, buyer's agent, deposit, conveyancer, inspections etc) on an investment property. The bank deposited the funds into an offset account which was offsetting my PPOR. I drained the funds over the course of about three months. I ensured the offset account was empty and the only outgoings were for the investment purposes, however, I've recently been told that this investment loan might not be deductible because:
(a) the money took too long to leave my account,
(b) the money was deposited into an offset account and is now treated as 'cash', not a loan,
(c) the money offset my PPOR, so lost its link to my investment property.
Is it the case that this loan has lost its deductibility? If so, what can I do to salvage it?
Thanks very much in advance.
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