Another FHOG Question

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From: Ten of Diamonds


Does anyone know what the laws are regarding me living in my investment property (after getting the FHOG) and receiving rent from one or two other people who I share the flat with? Do I have to declare this income? If so, can I make any deductions to offset the income, or is this against the rules for the FHOG. I would appreciate any opinions because I am quite confused about this one.

Regards,
ToD

 

[Mike]

Reply: 1
From: Mike .


Hi ToD,

The property is still considered your principal place of residence even though you may have rent paying boarders. Therefore, you are not disqualified from receiving the FHOG.

If you declare the rent as income in your tax return you are entitled to claim expenses relating to the rental income and apportioned based on floor space usage. For example, add the floor space of their bedroom to a percentage of the other living areas. Use this total percentage when calculating how much loan interest to deduct.

Regards, Mike