Buying a Share in Grandma's House - Tax Benefits?

Hi All

My grandma is looking at a Reverse Mortgage so that she may make some repairs to her house (there are major roof/electrical issues).
She is 75 and owns her house outright in WA which is worth around $800,000 - $900,000.

The one thing that she doesn't like about a reverse mortgage is that the debt basically increases over time.

I am looking at buying a 5-6% (repairs guesstimated at $50,000) share in her house. This would give my grandma enough money to make the necessary repairs.

Repayments are looking quite small, however, would I be able to claim the interest as a tax deduction? I do not live in the property and I do not expect her to pay any rent.

Thank you
Regards

Kyle
 
Repayments are looking quite small, however, would I be able to claim the interest as a tax deduction? I do not live in the property and I do not expect her to pay any rent.

No, you can't deduct the interest as there is no income. Wouldn't it be cleaner just lending it to her as a personal loan and get it all documented? You still can't deduct interest if you don't charge her interest, of course.
 
Sounds very messy to me.

There will be issues with the centrelink/pensions etc
CGT issues - she may have purchased the property preCGT and it may be CGT free, whereas your part won't.
Estate planning issues
Legal issues = conveyancing costs etc.
 
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