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Sunfish is correct in pointing out investing in downward trending Indexes (bear market) is a very poor strategy to make money. Having lost money in the first year will greatly diminish your returns in following uptrending years. A better strategy if you invest long, is to only invest in...

Depends on your PPOR loan. If it is principal and interest (P&I), then as the repayments are a scheduled (fixed) amount, the offset interest savings will effectively mean more is paid off loan principal. If you have an interest only (IO) loan then the offset savings will reduce your monthly...

This only works if the offset linked loan is non deductable such as PPOR loan. You then have an issue of a loan with private and investment drawings. On the other hand if the loan is an investment loan then putting your money into the loan reduces your deductable balance which is then...

Hi Bec, Simply and wholly depends on the usage of the loan funds. If the loan funds are used for an investment purpose, then they are tax deductable, otherwise they are not deductable. The type of security used for the mortgage is irrelevant. So if your parents say borrow against the IP to...

Hi bradje, Most lenders will assess your credit card as a regular debt whereby they look the minimum repayment to service the card at the credit limit; eg; $10000 limit at a minimum monthly repayment of 3% monthly is a $300 dollar a month expense. A $302 per month payment on a 30 year P&I...

Hi Sonic, Onedirect is ANZ's new subsidiary company for internet only marketing of mortgages. I have spoken to sales consultant and those rates will be held until January 2007, whereupon they will then pass on the current 0.25% rate rise to variable loans and any other rises that occur. They...

Corsa, great post and thanks for clearing up the reference to separate income accounts. I have a structure such as Rystar outlined, and had concerns over why private income should be deposited into separate account from investment income. I assume you may be now referring to separate account...

Mry, in regards to Section 8-1 of the Income Tax Assessment Act 1997, I refer to two private rulings 20834 and 52211. http://www.ato.gov.au/rba/content.asp?doc=/rba/content/20834.htm http://www.ato.gov.au/rba/content.asp?doc=/rba/content/52211.htm 52211 reads in part: WHAT THIS RULING IS...

Hello MRY, Your quote from the ATO is in relation to linked or split loan facilities, quoting from ruling: "This Ruling applies only to linked or split loan facilities as described in paragraphs 5 and 6 below. In this Ruling we refer to these loans as 'the facility". The ruling it is not...

Hi, this requirement above is mainly meant to stop landlords from claiming property expenses in periods when the property may be used for private purposes. However when you purchase land and build for the purposes of renting the property for income producing purposes then requirement are...

Mry, How much is too much money? In your original statement it came across as any over estimate of deductions would be penalised, which is what I disagree with. Geoff, totally agree with you :) , and the strategy of submitting new ITWV's as your circumstances change. Thus the online...

Mry The ITWV is only a forward estimate of your taxable position, and the ITWV has not the same financial and legal obligations as your end of year taxation return, which you verify to be true and accurate. So on what basis would the ATO financially penalize a forward estimate? There must...

Hi Steve, Here is a link to the ATO PAYG Income Tax Witholding Variation form which you can fill out online, save on your computer as you progress through the form, and return via internet to ATO: http://www.ato.gov.au/individuals/content.asp?doc=/content/57470.htm Why would you get an...

Hi Willg, Money drawn from loan into offset will not incur any interest expenses, that is the function of 100% offset facility on savings account. Primarily my concern is as you comment - "When you withdraw the money to fund further investments, you 'may not' be seen to be drawing down on a...

Hi Patosan, Thanks for reply. The reason I park a drawdown on IP loan into offset is when you wish to draw increased funds from non line of credit type loan, you must fully withdraw the full approved loan amount from the loan account (you could redeposit excess funds and then redraw when...

Hello all, I am aware of many posts in regards to offset accounts but I don't think they cover the below senario specifically. I am planning ahead when my PPOR loan will be repaid, on the parking of personal savings in an offset savings account linked to Investment Loan. However I will have...

Hi Mry, thankyou for clarifying the timing of when interest charges become claimable tax deductions. :) Tasman

Hello, this question is not about the prime eligibility of capitalized interest being a valid business expense, as I believe it can be depending on the circumstances of interest incurred, but on the issue of when the expense is claimed. Question is, if you capitalize interest on a loan...

Hi, When you apply for the variation to your withholding tax, there is an option on the form (Nat 2036-3.2001 page 7) whether you require bonuses to be taxed at normal rates or at the varied rate. Cheers

Hi GeoffW, thanks for your comments on life insurance. I believe as in your cases above, the time when you need life insurance the most is when you have dependents in early wealth formation years with dependent spouse and children. On the other hand, when your spouse has own career and income...