So, before I refinance my IP loan....

[Pushka]

Can someone confirm for me please:

1. Refinancing does not change the tax deductability of the loan? (our PPOR is the security)
   
2. Offset arrangements do not change the tax deductability?
   
3. Costs involved in early discharge of the loan can be deducted in the same financial year?
   
4. Um, anything else I should be aware of?

I am currently with Challenger finance - their interest rates used to be competitive but no longer; I also have some cash in the business account that I can offset to the loan, something I cant do with Challenger.

 

[Rolf Latham]

Hiya

Im not an accountant, but in general

1. if the purpose of the funds does not change, the security is usually irrelevant
2. Offset certainly wont cause any problems
3. Exits are usually regarded as borrow costs, so deductible in the year incurred

ta
rolf

 

[LynnH]

Borrowing costs are normally deductible over 5 years or over the term of the loan, whichever is the lesser.

Cheers
LynnH