Changing from Interest and Principal Loans to Interest Only

[Leilah]

Hi All

I have a question.

In the past decade I was living overseas and thus wasn't that interested in getting tax deductions on my two negatively geared investment properties, given that I wasn't earning any other income in Australia.

I have now returned to Australia and realised that to increase the tax deductions it would be best to switch to interest only.

My question is this: does the tax office permit you to change from interest/principal loans to interest only and claim the bigger interest payments being made on the loans as a tax deduction? I just wanted to make sure I was doing the right thing.

Thanks in advance for any guidance on this.

Leilah

 

[Jamie M]

Hello

Welcome back

Should be fine.

Depending on the lender it should be a straight forward process coverting to interest only.

Cheers

Jamie

 

[Rolf Latham]

Hi All

I have a question.

In the past decade I was living overseas and thus wasn't that interested in getting tax deductions on my two negatively geared investment properties, given that I wasn't earning any other income in Australia.

I have now returned to Australia and realised that to increase the tax deductions it would be best to switch to interest only.

My question is this: does the tax office permit you to change from interest/principal loans to interest only and claim the bigger interest payments being made on the loans as a tax deduction? I just wanted to make sure I was doing the right thing.

Thanks in advance for any guidance on this.

Leilah

I smell ANZ from previous posts

so...............

Full credit app, new vals, new income check, blood test,the lot

Might as well move to a lender that doesnt have stoopid rules due to its own incompetent business process which they try and disguise under "responsible lending"

The pain to move may be less.

ta

rolf

 

[XATON]

Most of people can do this without too much hassels unless Banks have not done your credit review for a long period of time, then they may request additional info to reaccess your repayment capacity, i.e. cash flow.

In term of tax deduction on interest, it shouldn't be an issue unless you try to increase the balance of loan for other purpose.

 

[Leilah]

Thanks to you all for your advice.

cheers

Leilah

 

[Aaron_C]

So true rolf. ANZ really ***** me.

 

[INXS]

Hi All

In the past decade I was living overseas and thus wasn't that interested in getting tax deductions on my two negatively geared investment properties, given that I wasn't earning any other income in Australia.

Leilah

You should ahve lodged a non resident returns for the past years you were overseas so the losses could have been carried forward and used against any future rental profits and capital gains.