Thanks Terry.I was advised by the financer that having a corporate trustee will get caught under commercial lending.Are there large banks who will lend to a corporate trustee at individual mortgage rates?If not then I will have to rethink my strategy about how to set this up!Thanks for all your help.Scab

Thanks Terry, I will speak to a lawyer regarding this.I'm located in South Australia.I've never changed title deeds before, will this cause a headache if I decide to go through with this?It is the only way I can think of to hold the property in a trust with a corporate trustee as the other avenues I have covered are:       Me borrowing the money…[Read more]

Check your inbox.CheersBinscab

Hi Benm84Yes you can lend money back from a company to the trust but like I said earlier there will be consequences in doing so.Your best bet is going to your accountant with this situation and specifically ask him what are the Div7a and Subdivision EA consequences of lending distributions from the trust to the company back to the trust.You will…[Read more]

I thoguth a Q/S only does the furniture and fittings + other Plant and equipment?I have asked if they can allocate some value to the furniture and fittings of the apartment per Steve McKnights book.Thanks for all your help guys!

Hi BankerYes this was the case previously.However in the eyes of the ATO, a Trust which has distributed money to a Company but the money maintains in the Trust is seen as a Unpaid Beneficiary Entitlement. Previously, this would have only caused an issue if a beneficiary other than the company (say an individual) owed money to the Trust – this…[Read more]

Terryw wrote:
Trustees are assessed at the top rate on undistributed income, i beleive. If might be better to distribute it to a company which then lends it back to the trust.

Fantastic ideas from Terry as always.However with the new laws coming in if you lend money from a Company to a Trust  that is seen as a Div7a loan which means you have…[Read more]

"I also want the loan to be in the name of the entity, this way I can borrow more in the future in the another entity (according to Steve's book)"Ignore that bit! I just did a search and seems like the consensus is that it's a myth.If that's the case, should I just borrow the money in our personal names and have the property in the…

binscab wrote:
I also want the loan to be in the name of the entity, this way I can borrow more in the future in the another entity (according to Steve's book)

Ignore that bit, I just did a search and seems like it's a myth.If this is the case, then would it just be much simpler to write the loan in our personal names but purchase the property…[Read more]

Stera wrote:
The slight hurdle at this stage will be financing the project over the 12-15 months of construction and the related taxes.I am completely green (  Learners hat again)! and would appreicaite any feedback or suggestions.My understanding of the biggest hit is CGT, but my understanding is that if you hold the property for 12 months…[Read more]

If you are renting out the property you can claim expenses associated with renting it out such as 1. interest paid2. Water rates3. Council rates4. On top of this you can claim 'depreciation' on assets in your rental property (pretty much everything which has a useful purpose on its own can be depreciated) such as the fridge, hot water system…[Read more]

siraitken wrote:

AndrewH wrote:
meh…

Meh… What?Meh you can't be bothered reasearching?Meh it is too hard?If this is the case then you don't deserve 10% returns let alone a cash flow positive property.Dave

Another poster 'shoutfromtherooftops' or something along those lines was posting some abuse and I think 'meh' was his reply, after…[Read more]

Hey MattThanks for the heads up!Am looking forward to learning as much as I can from these forums!CheersBinscab

Am I missing something?

Oops sorry – I got a bit confused.It depends on who has the option (i.e. if it's a call or a put)

Don't forget though if you enter a contract with a option to buy in 8 years for well below market – fair enough the parents will not need to pay any CGT due to the arms length transaction vs market value rull.But you've technically made a gain on excercising your option, the gain being the difference between the price you pay and the market value…[Read more]

Thanks DDI will analyse my options, the main factor of why I need to go in with a partner is pretty much because the banks won't give me much more money.I guess what I ultimately want is a positive cashflow property. Would you be able to elaborate on "510income /475 cost means its about 5.2% return. This in itself would deter me from doing it as…[Read more]

I did not know once you retire you can sell assets CGT free – from the sounds of it, you've done the research and have determined that retirees can do this.If this is the case if your friend keeps those payments up but put it as 'rent' on paper and buys the property for $275,000.00 in 8 years time, it would be CGT free. However, if this is not…[Read more]

Extra things I forgot to mention:I don't have a offset account (I have no idea why!)Currently paying interest onlyI have $0 savings, all profits go to offsetting the mortgage hence buying the new place would mean I am using equity on my home.I am currently renting my place out under the 6 year main res exemption rule so I can claim the interest…[Read more]