With drawing money to purchase shares/

Hi,

With the recent rapid falls in the share market these past few days, I think now is a excellent time to enter the market because of the low prices.

So my question is can i withdraw excess money from my account? it wouldn't be treated as personal because it's for income producing purposes, is this correct?

Also i do not have a off set account
 
correct - this is considered an investment, so the portion you withdraw will still be considered tax deductible.
 
Hi,

With the recent rapid falls in the share market these past few days, I think now is a excellent time to enter the market because of the low prices.

So my question is can i withdraw excess money from my account? it wouldn't be treated as personal because it's for income producing purposes, is this correct?

Also i do not have a off set account
Just ring up a Broker and have a talk to them,and just set something up, but just ask yourself one question if you were to buy into something high-end low-end if you think the prices are now low,as most are ex-div, what happens if they drop another 20-50% what would you do,there is a lot of high end day traders that think this market may well drop into the very low 4000's,,very quickly..willair..imho..
 
Hi,

With the recent rapid falls in the share market these past few days, I think now is a excellent time to enter the market because of the low prices.

So my question is can i withdraw excess money from my account? it wouldn't be treated as personal because it's for income producing purposes, is this correct?

Also i do not have a off set account

Ideally you would want to have a separate LOC or split in your home loan to draw down from to purchase the shares ... this would make it a lot easier to account for which debt is for investment purposes.

Regards,

Jason
 
willair makes a good point - as with any investment there are always risks involved, and as long as you are willing or able to hold for a long period of time if necessary and don't expect to make a quick overnight dollar then you should be okay...
 
So my question is can i withdraw excess money from my account? it wouldn't be treated as personal because it's for income producing purposes, is this correct?

I believe the technicality is in whether the shares you buy pays dividends or not. If they don't pay dividends, they are not income producing.

The Y-man
 
Correct, the company must pay dividends or have a history of paying dividends.

Wow! ok I didn't know this. Well in most cases most companies pay dividends. This is a long term investment at least 1 or 2 years.

I sold all my shares before the GFC had its full impact and got back in again when the market picked up and made a nice profit and I see this as another opportunity again.

I did have a small exposure to the recent falls... but I'm not that worried as it will recover overtime.
 
Suppose a separate loan is set up to purchase say $50K worth of shares. The interest on that loan is deductible.

But what if the shares drop to $40K in value and you sell and pay out the loan. There is a remaining $10K debt.

Is it now non-deductible now that there is no longer an income producing asset associated with it? Or is it still deductible because the original purpose of the loan for an income-producing asset?
 
I'd expect that the balance of the loan would no longer be deductible.

There'd be the consolation of a $10K capital loss on the shares to apply against any capital gains, however.
 
Top