Is it allowable to adjust your LVR on an investment property/properties within your portfolio to ensure you are getting the best return via negative gearing.
Purchase Property for $250,000 on interest only 6% mortgage $30,000 deposit - $220,000 owing
LVR = 88%
Loan has offset account attached and you pay in $20,000 - $200,000 owing
LVR = 80%
Interest rates change and you move capital out of your offset account which changes the amount owed on the property to the full amount of the mortgage.
$220,000 owing LVR back to 88%
How is this viewed by the ATO for tax purposes from 1 year to an other?
Purchase Property for $250,000 on interest only 6% mortgage $30,000 deposit - $220,000 owing
LVR = 88%
Loan has offset account attached and you pay in $20,000 - $200,000 owing
LVR = 80%
Interest rates change and you move capital out of your offset account which changes the amount owed on the property to the full amount of the mortgage.
$220,000 owing LVR back to 88%
How is this viewed by the ATO for tax purposes from 1 year to an other?