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Not ideal, but it could be acceptable to the ATO. I suggest you consider a private ruling.

Yes that is not a good idea. Your offset contains borrowed money. and you would be diluting this.

Yes, but don't forget the other $10k used for stamp duty and legals. Interest on the full $310,000 would be deductible.

New value is $550,000. 80% of $550k is $440,000. But you owe $400,000 so there is an extra $40k which you could pull out (subject to servicing). You would set up a new split for $40,000. This is secured by the PPOR. Purchase the investment property for say $300,000. Borrow 90% or $270,000...

I am a tax lawyer so recommend people ways to make sure the interest is deductible. But I am also a mortgage broker so recommend the product side as well and sometimes it is not feasible to get a LOC with particular banks. An IO loan may also work in a similary fashion. Worse case borrowing and...

That is reasonable. Nothing wrong with this. My main worry with this is that you have borrowed in say 2013, parked in offset and then taken out of the offset in say 2014. There is no direct connection with the borrowing and the investing. However, it appears the ATO have accepted this as ok...

Cosmic Trevor, I see at least 7 issues with your set up. 1. LOC for non investment use is not a good idea. If you ever moved out of the house you would not be able to claim any of the interest on the LOC. Use the cash in the offset account to buy personal stuff 2. PI on house ? not so bad, but...

I can't think of any of my clients who have benefitted financially - but many who had locked in rates only to watch them drop. However many are the worrying type and locking in a rate has benefitted them in other ways - sleep at night factor.

That is probably be cause rates have been dropping for the past 4 or 5 yeas.

If a loan is fixed there is always the possiblity to get a separate LOC set up with the same bank using the same property as security. No difficulties as long as you can service etc. However if you cannot service or need to change banks for other reasons the fixed portion will hold you back -...

Don't bet on it. I have done many consultations with SS clients and most have probably made serious mistakes with structuring of loans.

Yes you are correct. Problems will result, especially if your loan is PI. A separate LOC would be the way to go. You could split the loan later, but any deposits into the loan would come off both portions so it would be best to split before using. The usual way for investors should not be...