NSW - PPOR then rent out / -ve gear ?

Hi, I have a question and I am sure you gurus can help me.

I am buying a property, this could be my PPOR in few years time.
I have always been renting. The place need some small renos which will last at least 2-3 mths I think.

Therefore please confirm the following ?
1. after settlement I "move in", claim as PPOR, therefore after a certain period as PPOR I then can rent it out for max of 6 years, move back in as PPOR , and sell and still CGT free ?
2. the question is during the max 6 years renting out, can I claim -ve gearing since it is an IP ? that is claiming depreciation, interest cost etc etc ?

thanks in advance.

1. Should be as long as you move straight in at settlement. No delays or tenants.

2. Yes claim deductions, you have to because you will be declaring the rent as income.

But make sure you ask your accountant or get one. If they are doing your return then they should give advice you need.

bits1010 said:

"move in"

Click to expand...

By "move in" rather than just move in, do you mean you're going to pretend to move in and live somewhere else?

You must establish it as the main residence before you can get the absence from main residence Cgt exemption.

Once property is rented you can claim all the usual expenses.

And watch the land tax provisions. Assuming you are under threshold should be no concern. Ips are subject to land tax (with threshold)

yes, my "move in" includes changing address of
1. drivers license
2. electoral roll
3. electricity / banks / phone / employer address
4. placing a mattress in one of the bedrooms. and sleep on it
5. car registration address, if insurance is cheaper.

bits1010 said:

yes, my "move in" includes changing address of
1. drivers license
2. electoral roll
3. electricity / banks / phone / employer address
4. placing a mattress in one of the bedrooms. and sleep on it
5. car registration address, if insurance is cheaper.

Click to expand...

You left out the most important bit - you? will you be living there as the main residence or just changing postal addresses. From the above it doesn't appear so.

Make sure you really do live there. Fraud is a criminal offense. You'd start with having to pay back the money you saved, getting a fine for even more and topping it off with a criminal record which will possibly affect you for the rest of your life.

All that aside, make sure the loan is set up to reflect an investment structure. If done badly it can cost you tax deductions when the property is an IP.

Yes I will live there because I need to manage the reno.... it could last for months....

I think the best loan structure for future IP purpose is to have a 100% offset linked to it, when it is PPOR park as much cash in the 100% offset to minimise interest, and when it is IP can remove it with justification, can negative more for the right use of the cash.

it is because at the moment I am living with relatives, how much stuff to take to the new places is under my control....