Can I rent out half a unit?

Hey guys, I'm looking at buying a 2 bed unit next year for around 320k. Is it possible to live in one room and rent one room to a mate for 250pw? If so will the bank calculate this into their serviceability when they process my loan?

Cheers.
 
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$250 pw for one room in a $320K unit sounds a little high!! Presuming you occupy the main bedroom, it means the rental potential of the entire unit would have to be around $500 per week. I doubt the bank will allow this.
Marg
 
Eddie, you may lose some more of your cake... ATO says you're not exempt from CGT when renting out part of your PPOR, while you reside there.
 
If you can get the approval without taking into account the room rent that's great. Then you just rent the room on a cash basis and not be liable for CGT.
 
If you can get the approval without taking into account the room rent that's great. Then you just rent the room on a cash basis and not be liable for CGT.

Just wondering how you get around the ATO not finding out, even if rent is paid cash.

If you both put in tax returns, with the same address, claim you are not in a relationship, and one person is claim PPoR, then I thought it would be pretty obvious that the owner is renting out a room.

Or havent the ATO got onto this yet?
 
Ask your mate to pay you cash, dont declare the 250 per week as your rental income otherwise you will pay capital gains tax if you sell.
 
Won't the ATO find out when the flatemate puts in their return and says they pay $250 per week??
I've never, ever declared anywhere that I pay rent except to get rent assistance. Its not something you tell the ATO unless you're a travelling salesman or something and are claiming accommodation deductions, but that is pretty rare.

I've charged board in a sharehousy subletty kind of situation before, it seems really common and doesn't count as income for anyone - ATO, Centerlink, you name it, its just considered sharing your expenses. Quite odd, but that's how it works.
 
I've never, ever declared anywhere that I pay rent except to get rent assistance. Its not something you tell the ATO unless you're a travelling salesman or something and are claiming accommodation deductions, but that is pretty rare.

I guess I'm just used to declaring rent as I have always been self employed since way back and it's deductable at around 25% or whatever space you use as your business.
 
I guess I'm just used to declaring rent as I have always been self employed since way back and it's deductable at around 25% or whatever space you use as your business.

Are you aware that claiming tax deductions against your PPOR for renting a room or carrying a business compromises your CGT exemption?
 
Are you aware that claiming tax deductions against your PPOR for renting a room or carrying a business compromises your CGT exemption?
And that is the reason we've never claimed it, ditto a portion of council rates. We work from home and barely get past electricity, phone and the occasional travel expense.
 
Are you aware that claiming tax deductions against your PPOR for renting a room or carrying a business compromises your CGT exemption?
Well I have only been in PPOR since April and I'm not renting out any rooms but I think I will talk to my accountant about the business part soon, thanks for letting me know that.

I will be travelling soon and living overseas for around half a year and will turn both my properties into IP's anyway. I think I will need to start a new thread about that soon as there are a few questions I need to know about all that....
 
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