You need to be very sure about your strategy. Remember a fixed rate loan locks you into that property for 1, 2, 3, 5 or 10 years – otherwise it can be very expensive to exit! The only other alternative is to switch the loan to a new property but you have to have the right loan in the first place.

Daniel
The accountant you spoked to doesn't have a clue! – I can say this because I have been an accountant for 11 years. A DT is the way to go.
From reading the comments above, it would seem the concept of a Family Trust was discussed. Put simply, if there are losses from prior years to carry forward you need to lodge a Family Trust Election which reduces who you can distribute to (basically close family) – irrespective of what the Trust Deed says. The alternative is athat  series of "tests" must be passed by the DT.

I would use an option incorporating agreeable terms.

 
I agree with Terry's comments regarding the quarantining of the losses – hopefully you are purchasing a positive cash flow property – and FBT – however, as you would not be classed as an employee for common law purposes, FBT is easily avoided.

I don't mean to be rude, but what business is it of ours what signs are put up on telephone poles! If they are as horrid as you suggest, and they are on telephone poles, your local Council will take care of them. By the way, it's not me!

I think an acknowledgement of debt would be the way to go – because you are talking about a liability you can't make provision for it in your will. Your estate will collect all outstanding monies and pay back your fiancee as per the acknowledgement of debt.

The advantages of converting your PPR to an IP and renting can be substantial – tax savings (don't forget depreciation may be claimable on the construction cost of the house – depending on the age of the house) and you may be entitled to some rent assistance (if you have children) – in some cases this can be approximately $60 per week.

You are right, but what if you purchase another PPR – you then have to choose which property to apply the PPR exemption to – that is why I made the suggestion regarding obtaining a valuation at the date the property became available for rent – it "uplifts" the cost base.

Costs less than $400 to establish and a similar amount to complete the annual Financial Statements and Income Tax Return. Having one property per trust also assists in bookkeeping to ensure the correct income and expenses is matched back to the correct property. As an accountant I have seem many investors purchase multiple properties in the one trust. Because there is income coming in from multiple properties and expenses going out, bookkeeping becomes a challenge – remember not all investors are good bookkeepers! The annual fee for preparing the Financial Statements and Income Tax Return then becomes a lot more than it needs to be.

No additional costs, but if your old PPR was your PPR for the entire time you owned the property up until it became available for rent, you can obtain a valuation of the property when it first becomes available for rent. The value becomes your cost base for CGT purposes for when you sell the property rather than what you paid for it. For example, if you purchased the property for $300k 3 years ago, and then converted the property to an investment property 2 years later when the property was worth $370k, the $370k is your cost base for CGT purposes, not the $300k.