We are looking at setting up a trust structure for our PI
Have been advised to use a DT, me, wife & corporate beneficiaies. I undeerstand that I would register a company to act as the trustee. Would my wife and I be the best options for directors of the trustee ?
I would like to have each deal owned by seperate entities, thought of using a utrust to purchase each deal and having the singe unit then owned by the DT. This has two advantages being every borrowing application would be in a new name and I’m guessing the deal could be onsold, by selling the single unit in the utust without incurring SD which would be charged if I sold the IP directly. In this multiple trust scenario would I use the same trustee for all trusts ?
Is this a common setup or is there a better way ?
Thanks in advance…
Between your wife and yourself as directors, that would depend on what you both do for employment. Are they high risk industries?
Why do you feel the need to have each deal owned by a seperate entity?
If I read it correctly, you wish to use a unit trust to purchace property with unit being held in a discretionary trust. What is your end goal for the property?
Keep in mind that this type of structuring would be costly to maintain. It is not so common to do unless you want to transfer properties to a superfund.
What are your investing gaols long term?
Hope this helps
CATA
Asset Protection Specialist
[email protected]Hi
You do not need a company to act as trustee, but having one would add protection.
Usually the directors of the trustee or the trustees themselves have to guarrantee loans of the trust. So having two directors/trustees will only create more risk by having 2 guarrantees.
Also beware of specificially naming beneficiaries on the deed. Some lenders insist on obtaining guarrantees from ALL named adult beneficiaries!
If you are going to set up multiple entities, maybe consider having control with one of you, and then set up the next one with the other person etc. This would depend on incomes and serviceabilities etc.
Not sure about the transfering of the units without stamp duty. I have had conflicting advice on this. Basically if you transfer the unit, no body is going to know as it is not public information, and only recorded by a minuite.
But the loan will be in the trustee’s name, and if you go and transfer the title at the land title office they will probably hit you up as they will see a change in ownership.
Terryw
Discover Home Loans
Parramatta
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