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  • Profile photo of CiaCia
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    @cia
    Join Date: 2004
    Post Count: 11
    December 13, 2007 - 8:05 am

    I got the form thanks but the submission date is for May 2008 which I expect is for 2008/09 tax year. I wonder can I still do a variation for this financial year?

    Cheers
    Cia

    Profile photo of CiaCia
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    @cia
    Join Date: 2004
    Post Count: 11
    July 26, 2006 - 3:38 am
    Originally posted by elkam:

    Hello Cia

    Hi Elka, See inlines, Cia

    Do you have plans for the money that you will get paid for the house. I mean are you planning to use it for more investing?. If so, why can’t you just keep the house in your name and get a mortgage on it which you use for investing.

    Cia ==> I want to put the property in a Trust because I will pay 15,00 tax a year on the rental income as I have no mortgage on the property & thus no interest payment to deduct. Plus I don’t want to live in it any more :)

    This will then be tax deductible and you can buy your next IP in a trust. All that wasted money on stamp duty seems such a pity. [glum]

    Of cause if you are planning to use the money to buy yourself another PPOR, then that doesn’t work.

    Cia ==> I plan to buy another PPOR :)

    Just a thought [smiling]

    Elka

    Profile photo of CiaCia
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    @cia
    Join Date: 2004
    Post Count: 11
    July 26, 2006 - 3:31 am
    Originally posted by Terryw:

    Hi

    With a hybrid, the unit holder borrows money from the bank to buy the units (not the house), the trust lets the property be used as security. Then the unit holder can claim the interest on the loan against their other incomes. Losses still cannot be distributed from the trust, but because there is no loan, there will hopefully be no loss.

    If there is no CGT, then I would suggest you try and get the value up as high as possible. This will help you borrow more, as well as reduce CGT if you were to ever sell.

    Terryw
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    Hi Terry,

    Thanks for your reply. Is the following example correct ?

    The Trust will buy the house for 700k (for example) & I will lend the Trust 700k to buy the house(which I will borrow from the bank).

    The bank loan interest will be 50k p.a. The rental income, which the Trust will distribute to me, will be 30k p.a.

    I can write off the difference (50k-20k) to my tax at my marginal tax rate.

    Is this example correct ?

    Cheers
    cia

    Profile photo of CiaCia
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    @cia
    Join Date: 2004
    Post Count: 11
    July 24, 2006 - 7:25 am

    HI Cata
    It is a hybrid trust. From what I understand if I am the main unit holder, then I can write the losses off agaist my personal tax.

    Cheers
    Cia

    Profile photo of CiaCia
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    @cia
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    Post Count: 11
    July 24, 2006 - 4:25 am
    Originally posted by Simon C:

    Hi there cia

    Just curious as to your main driver to sell it to a trust. I understand the many benefits you can get from a trust structure as have that structure myself as plan one day to move IP’s to an SMSF should super tax concessions remain as they are now.

    I had started our buying IP’s in my name and now moving to buying within a trust strructure for that main reason. At my age (mid 30’s) , I did not see much of a benefit on incuring stamp duty to sell to the the trust at this point in time.

    My understanding is you are still going to have to distribute that income somewhere as it cannot sit within trust. You may be able to minimise it via a company or other beneficaries.

    Anyway, be interested to understand you overall strategy and ideas

    Cheers
    Simon

    Hi Simon
    I have paid off the mortgage on the house so I have no interest repayments so I will be paying almost 50% ncome tax on the the rent received.
    Cheers
    Cia

Viewing 5 posts - 1 through 5 (of 5 total)