I am just starting out in property investment in Australia and doing some long term planning. I will be moving to England for work and family reasons in two years. I want to know if I begin investing in Australia via trust structures:
1. When I move to the UK, can I use my income in England to act as security against investments I make in Australia through the trust to continuing building my portfolio in Australia.
2. If this is the case, what strategy would be recommended for an overseas investor that can only spend a finite period of time in Australia reviewing new investment opportunities.thankyou
Hi Jcam
Probably going to need 2 Years Tax UK Returns for a lender in Australia to accept the income for servicing.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Get some advice on structuring the trust as there could be some issues with it being controlled from overseas. legal and tax consequences.
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
thanks guys appreciate it, I am ideally looking to start investment portfolio’s in both England and Australia as I will be splitting my time between the two, but would like to be able to expand both at the same time. Obviously the difficulty is I can only be earning a salary in one country therefore the issue of security for loans in the country I’m not working in seems a big hurdle and as you said controlling the trust from overseas. at this stage i am just trying to structure my long term plan, any resources or particular individuals you can recommend on the matter would be much appreciated.
Does anyone have any recommendations on a lawyer who specialises in international trust law, or someone who could be of assistance in the matter of controlling a trust from overseas?
I think you’re muddling terms a little bit. Income isn’t about security for lenders – but serviceability. Security is the asset which the loan backs – the location of this the lender cares about.
Lets say you’re an Australian who moves to the UK and gets a job over there. You’ll be able to qualify for a loan in Australia for investment properties based on this income pending you meet all other requirements, affordability, deposits etc.
Our office works with a lot of expats over in the UK – whilst there are some restrictions for overseas borrowers – it just comes down to getting the right advice on the right lender, structure product etc.
Corey Batt | Precision Funding
http://www.precisionfunding.com.au
Email Me | Phone MeInvestment Focused Finance Strategist - servicing Australia-wide
thanks for that corey, yes I have got my terms confused, you are correct I was looking to use income earnt in england to service investments made in australia. Whats your thoughts on the above point raised about the trust being controlled by a trustee company that is overseas? I am a australian permenant resident but I am english if that makes any difference.
also you say your company deals with a lot of this kind of thing, what are the tax consequences of not being in australia to earn a salary yet making investments in australia
The tax consequences are vast and complex. An experienced tax lawyer or accountant would be needed to go over it. Expect to pay $900 per hour or more for this sort of thing. Not somethign that I would advise on because of the complexity.
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
thanks for that corey, yes I have got my terms confused, you are correct I was looking to use income earnt in england to service investments made in australia. Whats your thoughts on the above point raised about the trust being controlled by a trustee company that is overseas? I am a australian permenant resident but I am english if that makes any difference.
also you say your company deals with a lot of this kind of thing, what are the tax consequences of not being in australia to earn a salary yet making investments in australiaAs TerryW has noted – you really need to get specific tax advice from an accountant/lawyer specialised in expat taxation arrangements. Otherwise you’re likely to be going down a path because you think its right, not because it was necessarily the best pathway/path of least resistence.
As per overseas corp trustee – Australian lenders will definitely prefer to see an Australian Pty Ltd as the trustee over a foreign entity, so weigh this up in your decisions.
Corey Batt | Precision Funding
http://www.precisionfunding.com.au
Email Me | Phone MeInvestment Focused Finance Strategist - servicing Australia-wide
On a more random note, a query about serviceability in above mentioned trust structure, is an individuals credit rating taken into account when the salary is used to service investments
On a more random note, a query about serviceability in above mentioned trust structure, is an individuals credit rating taken into account when the salary is used to service investments
Yes. but which individual will depend on how the trust is structured.
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
You must be logged in to reply to this topic. If you don't have an account, you can register here.
