Forum Replies Created
Het Westan,
Completely agree with your comments and I hope others take note. Just staying their bumming around, may get you into trouble. I’m sure theirs plenty of chef jobs over their for me to take part in while I visit my properties and hopefully buy more or even spot for Mini. God knows I have worked with many kiwi chefs here that have worked under me and qualified to become Oz residents. So I’m glad you have raised that point!
Regards
Chef
Hi Guys,
I just want to make some general comments here as this topic could open up a can of worms if you know what I mean!!. Westan’s right, Nigels right, GP is right in a way!
One main difference between Australian Trust and NZ one is that the residency tax status of a NZ trust is determined by the Settlor whereas in Oz its determined by the trustee. So if your Lawyer is a kiwi an acts as the settlor in NZ, then its a NZ trust.(short version)
Now GP Let’s take the case whereby you setup a NZ trust with nZ company trustee with foreign directors(from OZ), something similiar to my structure.Let’s say you kept all the profits and CG in the trust and never distributed it and paid about 30% tax on it because your accumalating it in the trust. What would stop you from going over to NZ for 6 months or so, where you automatically become a NZ resident and then distributed to yourself as a NZ resident. You could do it this way. If its a small sum, its probably not worth doing as my Australian accountant said, however if its a large sum like 100k, then I would live their definitely, why not a beautiful country is it not??
Of course if you didn’t do this and just bought the money over, then your right because the directors have Aussie tax resident status and not NZ, you bring back 100k and lose half to the ATO.
Just my thoughtsRegards
Chef
Goodmorning Mini Mogul,
I tell you what I think. I think your chances are extremely good because your a legend. I also think you will have to change your name to AKA mighty Mogul.
Godbless & thanks for coming!
Phil & Kate,
Basically tell your accountant to go on holidays because he needs one.You should set up the structure first, & then go buy IP’s. As for your PPOR, maybe have Joint ownership 99% to 1% and be fully insured inside & out. If you run a business in your own names then change the structure as to seperate yourselves from the house.Go take a quick look at the Chris Batten.com.au website with some information.If you want to do it right the first time, then go see Chris & don’t sign anything until you have the right structure to suit your needs for today and the future. Your the client afterall. It can be extremely costly down the track(I guess thats why your broker & accountant gave you advice not in your best interests). People get into trouble when they listen to people who don’t know what there talking about & that includes your accountant & mortgage broker who should have referred you on to a specialist.
Regards
CHEE
HI THERE,
I HAVE A COUPLE OF SUGGESTIONS FOR YOU. FIRSTLY GO SEE A PROPERTY TAX EXPERT. I RECOMMEND CHRIS BATTEN (CHRISBATTEN.COM.AU).
I HAVE BEEN TO SEE HIM, HE HAS SET UP A HYBRID DISCRETIONARY TRUST. HE IS THE BEST IN THE BUSINESS.THIS STRUCTURE ENABLES ME TO CLAIM THE LOSS ON MY PERSONAL INCOME, IF I GET INTO A NEGATIVE GEARING SITUATION.
IF YOU ARE OPERATING AS A FAMILY TRUST OR JUST A DISCRETIONARY TRUST AS ITS COMMONLY REFFERED TOO, THEN YOU CANNOT CLAIM THE LOSS AGAINST YOUR INCOME FROM THE COMPANY OR ANY OTHER ENTITY WHETHER INDIVIDUAL E.T.C.
YOU SAID THAT YOU TRANSFER MONEY FROM YOUR COMPANY TO THE TRUST AS INCOME ADMINISTRATION? I’M NOT SURE WHAT THE PURPOSE OF THIS IS?ITS HARD FOR ME TO COMMENT AS I DO NOT REALLY KNOW HOW YOUR INVESTMENTS ARE STRUCTURED,BUT IF YOUR GOING TO PUT MONEY INTO THE TRUST, PERHAPS DO IT AS A COMPANY LOAN TO THE TRUST(WHICH IS AN EXPENSE) & PERHAPS PLOUGH SOME MONEY(IF YOU HAVE IT)TO MAKE THE NEGATIVE PROPERTIES POSITIVE.THEN LATER ON USE YOUR POSITIVE INCOME FROM THE FAMILY TRUST TO REPAY BACK THE LOAN TO THE COMPANY(TRUST EXPENSE & YOU ONLY PAY 30% TAX RATE ON THE INCOME).
ANOTHER SUGGESTION DON’T BUY ANYMORE PROPERTIES IN THIS FAMILY TRUST STRUCTURE UNLESS YOU KNOW THEY WILL MAKE MONEY FROM DAY ONE.
ANY OTHER QUESTIONS I WOULDBE PLEASED TO HELPYOU CAN HAVE A PHONE CONFERENCE WITH CHRIS IF YOU ARE OUT OF SYDNEY, YOU WON’T REGRET IT
DAVIDHouses,
Its all about affordability. Sydney & Melbourne are out of reach for many, & that’s why there is a good chance that rate of growth will slow. The people that are going to get hammered, are the investment unit buyers,because of an over supply problem,and the fact that in comparison to houses on a land basis, they are more expensive. It’s the land that doubles every 7-10 years, not the house itself. Houses & Buildings depreciate, land appreciates always & forever will. Does the government allow you to depreciate the land on an IP? I don’t think so, & there is a good reason for that!
Units have less than 10% of land content, & the majority that buy are investors, not owner occupiers.
Qld is still affordable, & still growing in population terms.Its affordable for those who have the income to negative gear for the long term, but for positive cash flow investors, your going to find it hard to get in there now.You will have to go further North.
GuYS,
Things are getting out of control here. We are steering away from what we were all talking about. Its not about which is better, its about if negative gearing works or not.Simply put, if done right, it works.
The facts are both strategies work, but people that have cash flow positive properties have obviously different financial goals to what say I do.
Bottom line here is that I follow & listen only to what the rich do, & that is put my excess cash into property for Compounded Capital growth over the long term. To acquire as much investment debt as I can, while having no personal debt.However I believe if you are going to negative gear, you should buy affordable newer houses, with reasonable land content. Ultimately, its the land that appreciates & buildings depreciate.Why Does the government not allow you to claim depreciation on land? but you can claim it on Buildings, chattels e.t.c. This is why generally speaking, units are not a good investment. They have less than 10& land content, & high percentage of units are bought for investment use only, & not owner occupies like houses are.
Thats enough for me for today
CHEE
Crashy,
Simply put, your pessimistic view on negative gearing is wrong. Sure people have been burn’t by it, but that is because they don’t know what there doing. They are not educated, they go out & buy an overpriced $500,000 unit in the city, & lose big time. Or they might buy a 40 year old unit because its cheap, & lose all of the advantages of negative gearing altogether.
Like all investments, there are so many reasons & variables why people fail in ther conquest to make money.
Wealth creation is about making one dollar into 10 dollars by the power of leveraging into appreciating assets like property using other peoples money. Using that capital growth to duplicate into many more properties, without using any of your own money. Negative gearing is a long term stategy, just like wealth building, & you will find that if you buy affordable new quality properties in good locations & hold, than you will do very well.
