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I went to the one in Clayfielf (Brisbane) a few years ago and was told that one IP per year is unrealistic.
Have not been back.
CATA
Asset Protection Specialist
[email protected]CATA
Asset Protection Specialist
[email protected]That is correct Cia.
It may get a bit tricky, you borrowing money to buy units in a hybrid to but a house off yourself. I am not a loans broker but you should be able to do it. Terryw would be able to help here.
Then you will have cash to play with after the sale. I hope you have plans for it.
CATA
Asset Protection Specialist
[email protected]Sounds like a great idea Cia. The trust structure has many advantages, including Asset Protection and Tax Minimisation.
What sort of trust are you thinking off?
If the property becomes -ve grared inside the trust the losses will be stuck in the trust untill the trust becomes +ve.
CATA
Asset Protection Specialist
[email protected]Is that how you have gotten so many posts Terry, just post it twice.
Why did you go to an accountant and ask about HDT’s. They have there place but I think the question that should have been asked is, “do I need structuring and if so what sort of structure?”
Then ask “Why?”.All trusts have there advantages. As Terry mentioned, Asset Protection and Estate Planning with tax minimisation advantages. If using a HDT with the -ve gearing effect, the -ve gear is in your personal name. So in theory the trust should be +ve gear as the only costs to the trust are IP related (no loans inside the trust).
As the HDT becomes more profitable, the special income units can be purchased back by the trust, reducing your personal debt.
By doing it this way there is no need to refinance and also having no need to manage a loan in your name to a dicsretionary trust. And the option to issue more units in the future if need be.The question people should start with is “Do I need structuring?”
But if you are unsure, speak to someone (insert shamless plug here) like myself who does it as a speciality.Remember that HDT’s are not the only structure to use.
The posts on this site (and others) are for free also.CATA
Asset Protection Specialist
[email protected]I will come back to this later when I have more time. There is some questionable advice there, but I agree that HDT’s are not the only way to go.
CATA
Asset Protection Specialist
[email protected]It usually involves selling th IP to the partner, so the usual cost involved in selling will be charged eg. CGT, Stamp duty ect.
CATA
Asset Protection Specialist
[email protected]You could buy the IPin a Hybrid Discretionary trust.
Eack of you getting a loan for the desired amount in your own names, then purchase units in the HDT for $1 each. Trust then buys IP and can split profits as per unit value.CATA
Asset Protection Specialist
[email protected]Originally posted by ptn:Do my DT have to have a company component? I plan to have my wife, 2 kids and mother in-law as trustee. Will this complicates the process?
Did you mean trustee or benificaries?
You should be able to do contracting from your trust but the distributions will be affected by the 80/20 rule. If more than 80% of the income is earned by you, the distributions will go to you only (check your personal circumstances). Most DT’s are able to do business.I would keep the IP’s and contracting in seperate entities to limit your liability. A seperate trust would be better for this.
Hope this helps
CATA
Asset Protection Specialist
[email protected]Beautiful place. I invested in some R&R while I was there,but it was not the only reason I went. Not for Property.
CATA
Asset Protection Specialist
[email protected]I’ll keep you posted on how to find us.
Look forward to meeting you.CATA
Asset Protection Specialist
[email protected]The only people who think HDT’s are “grey” are the onerwho know little or nothing about them IMOP. They have there pros and cons, but still are a great structure
CATA
Asset Protection Specialist
[email protected]For the Brisbane Young Investors,
Some of us are getting together on Wednesday 2 August at the Breakfast Creek Hotel at 7.30 pm. Not just for young investors tho.
I am 30 and would like to meet some of you guys.
Hope to see you there.
[specool]CATA
Asset Protection Specialist
[email protected]Anyone intrested in coming please add a post on this link at Summersoft.com
http://www.somersoft.com/forums/showthread.php?t=26375&page=3
Just to confirm total numbers.
Thanks
CATA
Asset Protection Specialist
[email protected]I know (hick) the feeling Richard
And this is me after 6 [sick3]CATA
Asset Protection Specialist
[email protected]Thanks for nominating me Richard. How about I buy you 2 beers and you can do the talking for me.
CATA
Asset Protection Specialist
[email protected]Just an informal meeting for starters.
Maybe if there is enough intrest we can look at something more next time.
As for the professionals, Some who have said they would come are of a profesional background.CATA
Asset Protection Specialist
[email protected]This is not a seminar, just some like minded people getting together to discuss some ideas.
7.30 pm
August 2nd
Breakfast Creek Hotel.
as posted in a previous post
No charge, but if you want a drink it’s your shout.I’ve got a summersoft.com member bringing some of them also.
Should be a good night.CATA
Asset Protection Specialist
[email protected]How long are you planning for the reno’s to take?
There may be some tax advantages of other structures, depending on how long you will hold the property.
CATA
Asset Protection Specialist
[email protected]I will explain the different structures in general terms.
Company
A company is a seperate legal entity that has it’s own existance and own common and tax laws. Provided the annual reporting and tax obligations are met, it can live forever. It has many rights and obligations that an individual has but there are also many laws unique to companies, especially in tax law. It can borrow money, own assets etc.
The people who own the company are shareholders and the people running the company are the directors. With this type of structure the assets of the company could be attacked by litigants, as the can directors of the company.In some cases directors can hide behind the “corporate veil” which basiclly means that the directors are protected by the company structure and can not be sued.
If this is the case, only the companies assets can be seized. However special powers are given to some authorities to go behind the company and sue the directors. Also if the actions of the directors are criminal, then directors can be sued.Trusts
A trust is a seperate entity that also has its own common and tax laws. Because it is an entity of its own, the people who benifit from any distributions made by the trust can not be held liable for the actions of the trust. The trust owns the asset, and because there is no shareholders, unlike the company, there is no owner of the trust, making it more difficult of anyone th be sued for their ownership of the trust.
A trust also has signifant advantagges when it come to tax.If a trust is directly controled by a person as trustee, even though that person does not own any part of the trust, if any lawsuits are taken out on the trust, the trustee could be held liable for the actions of the trust.
To put further steps between you and the trust, a $2 company is appointed the trustee of the trust.
The big picture would be, You own nothing, but control everything.
I hope this helps
CATA
Asset Protection Specialist
[email protected]
