Ask An Adviser - Can I borrow against an existing share portfolio and claim a tax deduction? (2)

Top answer provided by:

Lisa Scott

Hi Michael,

Thank you for your question.

Unfortunately, your question is missing a crucially important detail – What are you borrowing the money for? Where we talk about the tax-deductibility of any debt, we first look to the purpose of that debt and who is going to be making the repayments.

The actual security (in your case, a share portfolio) is irrelevant. For example, if you were using an existing share portfolio as security to borrow money to buy more shares, then the loan would be considered an investment loan (shares are an investment) and the loan interest would be tax-deductible. However, if you used the share portfolio as security to borrow money for some home renovations, you will have no tax deductions available as your home is not an investment. In any case, you should speak to your lender or mortgage broker and to your tax accountant before borrowing the funds and check whether any deductions may be available.

 

Disclaimer: This is general advice only and is provided for general information only, it is not advice. It has been prepared without taking into account your particular financial needs, circumstances and objectives. You should consult your own financial adviser before making any investment decisions.

While the Adviser Ratings Website facilitates the question and answer functionality, all such communications are between users and authorised financial advisers, of which Adviser Ratings has no affiliation. Adviser Ratings is not the advice provider and does not provide financial product advice and only provides information that is general in nature.

Article by:

Lisa Scott

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