Advice please - PPOR, CGT and tax deductibility

Hi all,

Keen follower of SS, first post!

Quick description of our situation.
Have a PPOR apartment in Sydney which we bought in '09.
Rented it out for 2 years whilst we were overseas but back living in it.
Have built up some equity and refinanced recently in order to begin a property investment strategy.
Have done a heap of reading and am deep in the analysis paralysis stage!

The plan is:
- Rent out our current PPOR - should be CF neutral or slightly negative.
- Buy a IP (house or townhouse) and rent it out (not sure where yet, Bris Vegas, Central Coast, Wollongong or Radelaide)
- Rent an apartment in Sydney to live in.
- Wait for CG and repeat.

Overall strategy is to buy IP's over the next 10 -15 years, whilst continuing in our jobs. Able to do small reno's or value adds on IP's with focus on CG.
Any CF would be a bonus.

My questions:
- Will the interest on our current PPOR (soon to be first IP) be tax deductible?
- What implications will this have in terms of CGT?
- To avoid the CGT, are we better off selling our current apartment (taking profit) and buying an IP (or two) with the sole purpose of the loan being investment?

Any advice is appreciated.
Thanks
 
1. Any interest associated with a loan to purchase the property would, generally, be deductible.
2. Implications of renting out? Could be rented out for up to 6 years with you still claiming it as your main residence for CGT purposes.
3. You can?t avoid CGT as you will always be subject to CGT as the property was rented out before you lived in it (my interpretation of your post)
 
Thanks Terry, much appreciated.
Just to clarify, does the 6 year period for CGT exemption begin from the date of purchase or from when you first rent out the property?
I hope that makes sense...
 
Thanks Terry, much appreciated.
Just to clarify, does the 6 year period for CGT exemption begin from the date of purchase or from when you first rent out the property?
I hope that makes sense...

From when the dwelling ceases to be your main residence - which may be the date you move out.
 
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