I have a tricky CGT question. All answers taken as discussion and not considered tax advice by me. My question is:
For non-dividend paying stocks (e.g. some speculative stocks) for which a loan was taken out to purchase them, were can the loan interest be taken into consideration when making a capital loss? When making a capital gain, the loan interest is added to the cost base, but when making a capital loss the reduced cost base is used, and loan interest cannot be included in the reduced cost as the third element no longer allows it (per private ruling 70225). Does this mean that loan interest on non-dividend paying stocks is only claimable if you make a capital gain (i.e by including it in the cost base), or can the interest still be claimed some other way in the event of making a capital loss? I'm not sure how, because for it to be claimable as a D7 or D8 deduction the stock would still have to be income producing...right??? Totally confused, as I'm sure others here are too, so replies to this tricky question are greatly appreciated. Thanks.