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  • Profile photo of campbellwcampbellw
    Participant
    @campbellw
    Join Date: 2012
    Post Count: 3
    luke86 wrote:
    scha9799 wrote:

    Put under trust is a safe way to go as far as asset protection goes.

    just check up your land tax threshold, if you buy under your and your partners name, the land tax will be treated as differently as you hold under trust.

    eg if the threshold is 200,000 then under your and your partner ( as family) you can have 200,000 + 200,000 = 400,000 limited before you reach to the threshold.
    but if you buy under trust, then you only will have 200,000

    check with your accountant

    No need to waste your accountants time- just check the Queensland osr web site.

    E.g. For a property with a land value of $500k you will pay $500 in land tax if held in your own name (assuming you have already used up the threshhold on another property). If held in a trust you will pay $4000. So you will pay $3500 extra in land tax by holding in a trust, however a trust will offer far greater asset protection and be much more tax effective so you will probably end up on top by holding in a trust.

    Also consider that each trust has a $350k land tax free threshold so if a property has a land value of less than $350k then you will be better off holding in a trust from a land tax perspective.

    Cheers,
    Luke

    Is asset protection the main benifit derived from holding in a trust? Is that concerning banks attempting to forclose on a particular asset? Or is this a family memebr etc coming after asset?

    I was hoping that there would be better tax benifits or overall CGT gains after I have fully realised the properties?

    IS there much of a cost in setting up a trust?

    Profile photo of campbellwcampbellw
    Participant
    @campbellw
    Join Date: 2012
    Post Count: 3
    luke86 wrote:
    Hi,
    If you are building a complex of 5-6 units on these blocks of land and you have enough equity/cash to put into the project, then I douct that you will need presales to get finance. As long as there is a solid exit strategy at the end (i.e. either refinance to hold or sell some and refinance the rest or sll all of them) and you can either service the interest during construction or arrange to capiliae the interest during construction then you should be able to build and hold.

    Also in my opinion a discretionary trust with a corporate trustee will almost always be the best structure for this, with probably a different trust for each property if you ultimately want to build multiple units on each property to hold. This will give better asset protection, be more tax effective and offer better estate planning than holding in your own name.

    Buying in a company means you don't get the 50% CGT discount so this is not really the way to go.

    Cheers,
    Luke

    Thanks very much for your guidance Luke its much appreciated.

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