After several years of saving my salary into high interest deposit accounts, I began looking for a suburb to invest in my first property that would experience continual Capital Growth. After months of research I choose Southport due to the future town planning involving the Broadwater beautification scheme, Smith St upgrades, Gold Coast Light Rail plans, and a new hospital planned for construction near Griffith University.
I bought myself a fully-furnished single bedroom apartment short walking distance from the Broadwater, shopping centres, and bus shops. I was approved for the FHOG and the Stamp/Mortgage Duty Concessions. The apartment had existing tenants, who had four months remaining on their lease. That was fine; to satisfy the FHOG and Concession requirements I was obligated to occupy the place within six months. Four months later the tenants move out, without any fuss. Rent had been paid up to date, no damage after an inspection. All went well.
Now it is getting closer to tax time, I have begun to research the ATO website for rulings and laws that could allow me to claim the mortgage interest, Body Corporate Fees and Council Rate expenses as tax deductions during the four months period the apartment was being rented. It is obvious that having applied for the FHOG and Concessions the loan was taken for the purpose of purchasing a PPOR. However for four months it was an income producing asset. What do you guys think about the deductibility of the interest, and other expenses involved within the four months of renting the apartment?
The rent from the previous tenants was a bonus, however if I can reduce some of my tax liability due to the deductions while the place was rented, that would be an added bonus. If the interest and other expenses are found as non-deductible, that is fine. I will keep working hard, putting as much of my salary into the offset account and wait one year until revaluating the property once the developments around Southport have brought the land prices up in value so I can access a LOC from the increase in equity combined with cash in the offset account to be used as a deposit on my first IP.
I bought myself a fully-furnished single bedroom apartment short walking distance from the Broadwater, shopping centres, and bus shops. I was approved for the FHOG and the Stamp/Mortgage Duty Concessions. The apartment had existing tenants, who had four months remaining on their lease. That was fine; to satisfy the FHOG and Concession requirements I was obligated to occupy the place within six months. Four months later the tenants move out, without any fuss. Rent had been paid up to date, no damage after an inspection. All went well.
Now it is getting closer to tax time, I have begun to research the ATO website for rulings and laws that could allow me to claim the mortgage interest, Body Corporate Fees and Council Rate expenses as tax deductions during the four months period the apartment was being rented. It is obvious that having applied for the FHOG and Concessions the loan was taken for the purpose of purchasing a PPOR. However for four months it was an income producing asset. What do you guys think about the deductibility of the interest, and other expenses involved within the four months of renting the apartment?
The rent from the previous tenants was a bonus, however if I can reduce some of my tax liability due to the deductions while the place was rented, that would be an added bonus. If the interest and other expenses are found as non-deductible, that is fine. I will keep working hard, putting as much of my salary into the offset account and wait one year until revaluating the property once the developments around Southport have brought the land prices up in value so I can access a LOC from the increase in equity combined with cash in the offset account to be used as a deposit on my first IP.
