Can I rent out a room to my relative within 6 months if I have received the FHOG?

by Howard
(Sydney NSW Australia)

I read your questions and answers, very helpful.


However, I still want to ask further if I could rent a room to my relative after 3 months of the property settled provided I have been living in the property all the time.

We share the bills, the rent is also 50% of the market rent. The property is in NSW.

I have received FHOG. The property and the mortgage are both under my own name, nothing to do with the tenant.

In this case, am I allowed to rent and claim for tax return?

Appreciate your response and many thanks.

Howard

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Aug 11, 2015
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Seek advice from your tax agent regarding renting during the first 12 months.
by: Elizabeth

Thank you for your enquiry, Howard.

It is my understanding that you cannot formally rent a room out within the first 12 months and still be eligible to keep your First Home Owners Grant (FHOG), even if you are still resident in the property and your tenant is a relative.

This is a bit of a grey area, however. Because I am not a professional Tax Agent, I would highly recommend that you seek advice before proceeding, and be absolutely sure of what you can, and cannot do before you sign any agreements with your relative.

The Office of State Revenue, NSW, should also be able to assist you with information specific to your enquiry, as they administer the grants.

It would be wonderful if you could help others searching for answers on Investing in Property Rentals, by posting your findings when you have a firm answer!

Kind regards,
Bess.

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