I have purchased an investment property off the plan that is currently under construction. Payment for the property is due at completion of construction and I had been granted an extension to pay the stamp duty by the Office of State Revenue. I have applied (and received bank approval) for an investment loan to cover the purchase price of the property and all purchase costs including stamp duty.
The construction of the property has taken considerably longer than expected and the extension of time to pay the stamp duty (approx $12,000) has passed so the stamp duty is now due with the completion of construction, and hence funding of the investment loan, still at least 6 months away.
I have $12,000 in savings to available that I can use to pay the stamp duty. If I was to use my savings to pay the stamp duty:
1. When the investment loan is funded can I replace my savings with funds from the investment loan?
2. If the answer to 1. if yes and I was to do this, can I claim the interest for the investment loan amount used to repay my savings as a tax deduction as it was originally used to pay the stamp duty or will the tax man not allow this because the money originally used to pay the stamp duty was not borrowed?
Thanks in advance for any assistance.
The construction of the property has taken considerably longer than expected and the extension of time to pay the stamp duty (approx $12,000) has passed so the stamp duty is now due with the completion of construction, and hence funding of the investment loan, still at least 6 months away.
I have $12,000 in savings to available that I can use to pay the stamp duty. If I was to use my savings to pay the stamp duty:
1. When the investment loan is funded can I replace my savings with funds from the investment loan?
2. If the answer to 1. if yes and I was to do this, can I claim the interest for the investment loan amount used to repay my savings as a tax deduction as it was originally used to pay the stamp duty or will the tax man not allow this because the money originally used to pay the stamp duty was not borrowed?
Thanks in advance for any assistance.