Brett Andrew Imlach, 42, said during evidence-in-chief that on the night of August 15, 2012, Marco Daniel Rusterholz told him that he had "just killed Ange Hallam and some fella" and wanted to get rid of her hair.

Mr Imlach said Mr Rusterholz told him that he bashed Ms Hallam's head into a bench, stabbed her a few times and killed her and the man.

"The young fella had come downstairs and tried to help Ange and got into an altercation with Marco and tried getting out the door," he said.

Mr Imlach said that he saw hair and a steel-toe boot in a bag while Mr Rusterholz drove them both from the Brooker Highway to Browns Road, Kingston, where the items were burnt in a 44-gallon fire drum.

He said that he was in disbelief about what Mr Rusterholz had told him until he saw it on the news, which prompted him to retrieve the ashes and contact police.

The Hobart man said Mr Rusterholz had previously told him that Ms Hallam owed him money and he would "do her in" if she failed to pay.

Defence counsel Evan Hughes asked Mr Imlach why he failed to originally tell police about what Mr Rusterholz had said, and Mr Imlach replied that he "was not speaking a lot of truth" on that occasion.

Mr Hughes accused Mr Imlach of pointing a finger at Mr Rusterholz to draw attention away from the Rebels Motorcycle Club. "May as well point the finger at the guilty person," Mr Imlach replied.

The third week of the trial of Mr Rusterholz, 51, of Rocherlea, continued yesterday. He has pleaded not guilty to the murders of Angela Maree Hallam, 31, and Joshua Eric Newman, 21, whose stabbed, burnt remains were found in a unit fire in Pioneer Parade, Ravenswood, on August 15, 2012.