IP offset account or gift to wife?

[rprodrive]

Hi

Hope someone can help me please.

I currently have a number of IPs with large loans attached to them (and circa 5.39% variable interest). I also have about $150k in savings sitting in an offset account that is reducing the deductable interest payable.

I am on the top tax bracket.

I was thinking instead of reducing the deductable loans with the money sitting in offset - that I 'gift' the $150k to my wife, and she place the cash in a term deposit earning interest over 5%.

As my wife does not earn any income - she will earn the interest income with minimum tax paid ($6000 tax free threshold).

Whilst I will pay more interest on the IP - that will be deductable and reduce taxable income.

So is this a good idea? Is it kosher, legal, etc?

Thanks for reading and your thoughts

 

[marg4000]

This is a simple numbers game.
Do your sums and go with the best result for you.
Marg

 

[Rolf Latham]

very kosher

as long as the 150 k is tax paid cash, and not borrowings !

ta
rolf

 

[Jonathon]

Or, if you have kids, you could gift or loan it to your family trust, then give each kid $3k pa of the interest tax-free (is it $3,666 this year?) with the remainder to your wife.

 

[Pushka]

I take it the cash is in your name only and not a joint account?

 

[rprodrive]

Thanks everyone - the money is in my name and is tax paid cash.

 

[WillG]

All you need to do is open the term deposit in your wifes name and put the money in.

Does it make a difference who's money it is? How is "gifting the money to your wife" recorded?

As Rolf said ... "as long as the 150k is tax paid cash, and not borrowings.

 

[rprodrive]

All you need to do is open the term deposit in your wifes name and put the money in.

Does it make a difference who's money it is? How is "gifting the money to your wife" recorded?

As Rolf said ... "as long as the 150k is tax paid cash, and not borrowings.

Perfect - thanks.