Mortgage / Transfer Fees

[skylynx]

Hello,

When you purchase an existing property, the bank charges you mortgage costs, such as:

* Transfer of Land Registration fee
* Discharge of Mortgage
* Mortgage Registration fee
* Government Title Search

Q: Can you claim all of this in the first year?
Q: Do you need to apportion over 5 years, due to the 5 year rule on mortgage costs (does that apply to all the above costs)
Q: Or do they ALL form part of the cost base of the property and no deductions allowed


On a side note, if I did a title search...can I claim this in full or is this a 5 year apportion thing as well?

 

[Rolf Latham]

Hiya

these look mainky like borrow costs, so you can depreciate them over 5 years or over the term of the loan if the loan is shorter.

ta
rolf

 

[jrc]

On a purchase:

1. Transfer - this is not a borrowing cost, but cost of getting the title into your name
2. Discharge - this cost would normally not be a borrowing cost, but part of getting the title into your name and allowed by the vendor in the settlement adjustments


If you did a title search that would normally be prudent and part of ensuring vendor was able to transfer title to you

 

[skylynx]

On a purchase:

1. Transfer - this is not a borrowing cost, but cost of getting the title into your name
2. Discharge - this cost would normally not be a borrowing cost, but part of getting the title into your name and allowed by the vendor in the settlement adjustments


If you did a title search that would normally be prudent and part of ensuring vendor was able to transfer title to you

Sorry, so does it mean that all costs with the exception of the mortgage registration fee can be claimed as a full deduction this year?

 

[AVD]

Hi

No it would mean they are capital and added as part of the cost base to reduce CGT if applicable if/when you sell. Government fees and charges are capital and costs directly associated with the loan and lender are borrowing costs (and claimed over 5 years apportionate to the days applicable), in a nutshell.

Alysha

www.gatherumgoss.com