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  1. Terry_w

    Loan Contamination

    I would have to sit down and think, but if you could split into the relevant portions - even if one of the portions were mixed, then you could fully pay off the mixed portion and start again.
  2. Terry_w

    Loan Contamination

    No. This is going to be very messy to work out as only part of the extra $300k initially borrowed will be deductible. She will have to go through statements and work out how much cash was put in over the years. Impossible to work out accurately if cash is going in and out. Say only half of this...
  3. Terry_w

    Loan Contamination

    Yes this is very common - but as Paul says they are not allowed to give tax advice. The trouble is most people would just accept what they say.
  4. Terry_w

    Loan Contamination

    Deductibilities depends on borrowings, so changing the credit limits on loans should not matter as long as drawn amounts don't change.
  5. Terry_w

    Loan Contamination

    No mixing. And don't try and buy me an orange juice with milk in it, or I might think there is something else in it.
  6. Terry_w

    Loan Contamination

    I would say avoid borrowing to park in the offset account. Too many things can go wrong. Only do as a last resort (I am not saying it will work either) and make sure there is no funds in that offset account other than the borrowed money.
  7. Terry_w

    Loan Contamination

    If you have a separate split of say $50k and then pay this into a savings account which also contains $50k so the savings account now has $100,000 and if you subsequently use $50k to invest then you may be able to claim 50% of the interest on the $50k - you could argue you can trace the money...
  8. Terry_w

    Loan Contamination

    Depends if it was done deliberately. Possibly the ATO would only go back 4 years unless fraud was involved.
  9. Terry_w

    Loan Contamination

    Instead of milk and orange juice what about milk and urine. If you place 20ml or urine in the milk for 1 second and then took it out - would you drink the milk?
  10. Terry_w

    Loan Contamination

    That's it!
  11. Terry_w

    Loan Contamination

    Same with the bank. They don't give tax advice but simply lend money. They don't go placing funds anywhere but ask the client where they would like the funds disbursed to. Hard to blame the bank for this one.
  12. Terry_w

    Loan Contamination

    Think of it this way You have 400ml of Milk and have say 10mil of orange juice. If you take out some of the milk and put it into your orange juice account, say 10ml of milk then later when you want to use your 10ml of orange juice how can you withdraw it? If you withdraw 10ml you will have...
  13. Terry_w

    Loan Contamination

    I am saying no borrowed money should be going into your offset account. But NAB are not as flexible as most, so if you must borrow with them then you might be able to set up a separate account to receive the borrowed money, but at no time should any other cash go into this account - And I am...
  14. Terry_w

    Loan Contamination

    You have borrowed money and plonked it together with savings. Interest is only deduction on money borrowed to invest.
  15. Terry_w

    Loan Contamination

    Your loan is contaminated. You need to confess to your accountant so he can work out how much of the interest to claim. See Domjan case.
  16. Terry_w

    Loan Contamination

    I was talking about a 'top up' too - doesn't matter what you call it, you are borrowing more money which should be done via a separate loan. Otherwise you will have a mixed purpose loan with tax problems.
  17. Terry_w

    Loan Contamination

    You don't need a sub account but a separate loan, which all lenders offer.
  18. Terry_w

    Loan Contamination

    Yes you would need a new loan, with a separate loan account number. You wouldn't want a fixed loan as you could not deposit and redraw. A LOC may be the way to go, depending on the lender. When your loan documents come if they are not set up correctly then don't sign but ask for them to be...
  19. Terry_w

    Loan Contamination

    Keep good records so you can use them in evidence later if need be. You should not be borrowing to park in savings accounts, but setting up a new split and keep the money 'in' the loan so that you borrow when you need it.
  20. Terry_w

    Loan Contamination

    Yes definitely will contaminate. Who told you this?
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