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Allocation of tax deductions on joint-investment property

Discussion in 'Accounting, Tax & Legal' started by samaka, 2nd Feb, 2009.

  1. samaka

    samaka Well-Known Member

    Joined:
    30th Sep, 2007
    Posts:
    308
    Location:
    Sydney
    Hi all,

    Let's say I purchase a property with one of my parents - and we own 50% each. Using easy figures, let's say we have a $100,000 loan and it costs 10% - thus for the financial year we pay $10,000 in interest.

    Now over that year we've deposited $20,000 combined into an offset account (from which the interest payments are debited).

    Can my parent claim all the interest payments (and I claim none)? Do the tax deductions have to be equal to the ownership of the property?

    This is the deal I'll probably doing with my parents. They are going to provide a big chunk of the deposit, and make repayments as well - however they will claim all the tax deductions (if possible).
     
  2. Simon Hampel

    Simon Hampel Co-founder Staff Member

    Joined:
    9th Jun, 2005
    Posts:
    4,619
    Location:
    Sydney, Australia
    Nope - net income gets allocated with the ownership of the property, in your case, you'll get 50% of the net income (which may be negative) allocated to each of you.
     
  3. Rob G.

    Rob G. Well-Known Member

    Joined:
    6th Jun, 2007
    Posts:
    717
    Location:
    Melbourne, VIC
    ATO TR 93/32

    Cheers,

    Rob