CREATING TRUST AND EXISTING PROPERTIES

Viewing 4 posts - 1 through 4 (of 4 total)

ftareen
Member
@ftareen
Join Date: 2006
Post Count: 8
December 26, 2006 - 1:08 am
I have read about advantages of trusts and would like to know on if it is possible to include my exisiting personal and investment properties into new trust. I am an employee, is it possible for me to get my salary into Trust ? All my new investments will be purchased into trust but I am more concerned on my existing properties. Any suggestions or reference to a good accountant in this area will also help
Richard Taylor
Participant
@qlds007
Join Date: 2003
Post Count: 12,024
December 26, 2006 - 2:28 am
You can sell your existing IP’s to your Trust but this will trigger both a Stamp Duty and CGT issue.
Think it is too late for existing properties.
As an employee you are unable to have your salary paid to a Trust.
Ensure that your Mortgage Broker has set up your loans correctly to ensure that future purchases in Trust are not happered by poor loan structuring.
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bridgebuff
Participant
@bridgebuff
Join Date: 2006
Post Count: 189
December 26, 2006 - 4:04 am
I just set up a trust after talking to my accountant. He gave me a big list of plus and minuses for trusts. Make sure you understand them all before ploughing ahead. Stamp Duty and CGT are certainly involved with existing properties and therefore not practical. The law sees the trust as a separate entity, similar to companies.
I would never do it without some really good advise from a professional that understands your individual circumstances and needs.
Terryw
Participant
@terryw
Join Date: 2001
Post Count: 16,213
December 27, 2006 - 9:48 am
Sometimes it is worthwhile paying stamp duty and transferring existing properties into a trust. eg. you have a large home loan and lots of equity in an investment property. You need to do the calculation to see how many years of tax savings it will take to save the cost of the transfer.
You can get your salary into the trust by becoming a subcontractor – if your employer will let you. But the ATO have hard rules to overcome, otherwise they tax you as if your earned it anyway = Alienation of Personal Services Income.
Terryw
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