Tax question about a savings account

[devo76]

I will try to keep this simple.

I have a savings account that has a $8000 balance. From this IP account my IP repayments are made.I have dipped into this a couple of times for personal things. This has not mattered as i do not have a LOC set up and the shortfall in repayments are put into the account from my pay account.Therfore no tax implications.

Now soon i will set up a LOC that will in the most part be used for IP purchases but may also be used for the occasional cost shortfall.

Now my question is if i transfer some LOC funds into the above IP account but from that point i no longer touch it for personal expenses. Will it affect the LOC from a tax point of view?

I know if you put the funds into a account to be used for IP costs THEN used it for personal expenses you would be stuffed. But i am planning on only using it for IP costs from the moment funds from the LOC are deposited into it.

I know i could just open a new account but if i could use this existing account it would save some time shuffling things at the bank and the realestate agent.

 

[Boyler_Room]

If you're simply drawing down on the LOC when you need to make IP related payments, and passing them through this account in the process, then I don't see too much of a problem. If you're intending to drawdown a significant portion of funds and park them in this account, I'd have to ask why you'd want to do something like that?

 

[devo76]

Thanks for the reply.
No im not parking funds there but i would like to keep the balance at around $5000. I travel for work a bit and if i know there is a buffer it will help my SANF while i cant monitor things.

My plan is to just add to it from either my offset account that my pay goes into or from my LOC( Keeping the balance the same each month). I was worried because it has a existing $8,000 balance that i did dip into in the past. It might affect the LOC tax wise.

As i stated but from the moment i deposit LOC funds into it. The account will only ever be used for investment purposes.

Does this seem OK?