I guess everybodies situation is different.
If properties are neg geared or even pos cash flow after tax, then a trust would not be suitable, would they not?
As the losses and write offs cannot be off set against personal income.
the only advantage i can see is if the properties are positive geared before tax, so you can distribute the income when and where you like, to miminise tax paid.
It normally would take a long time to own several properties like that, and you may need the tax advantage to help you get there quicker.I guess the other advantage is assett protection.
But if you work for wages, there is less chance of being sued.
Can anybody add some fors or againsts about trusts and their values?
Or correct any of my comments.
thanks for any replies.
frosty1
I guess towards the end result, you want properties to end up on the positive geared side, but as this occurs i would think it would be time to buy again. do you think?
You can always use a hybrid trust to allow negative gearing initially. There will be some flexibility, but later the trust can be changed to a discretionary when the trust buys the units back – CGT issues too, but will be better than just transferring the property to a trust later.
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
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