Sorry, yes. If it's your PPOR for 80%, you pay CGT on 20% of the gain. You can only use the valuation method if you live in the property first, then rent it out. As yours was rented from day one, you can only use the proportion method.

Yes, you get an exemption for the period it was your PPOR, but getting the 'valuation' method' is not available to you.Basically, you will pay CGT, when it is sold, for the period it was a rental, asa percentage of the total ownbership period.ie, held for 5 years, PPOR for 4 years. You will pay CGT on 80% of the capital gain.

Thanks for posting, it gave me a laugh.

number 8 wrote:
Dan42,I assure you Banker is not arguing that your personal circumstances require crossing- In fact you would not even consider the idea from the information you have provided.  What you have mentioned is correct. We all have our stories. The point he is making is don't bash an idea / concept unless you have considered every…[Read more]

Wife and I set up LOC as described on this forum by Richard, Terry and others, then used the LOC as deposit for our latest IP. We borrowed about 85% for the new unit. Bank wanted to cross-collateralise, and wanted to charge us above $8,000 LMI.Keeping everything split saved us at least $6,500 in LMI. So there's another reason to avoid.

You would need to see a copy of the trust deed.

Banker wrote:
Point 1: individual goes belly up. Bankrupt. The courts seize their assets and the balance sheet of the trust shows the trust owes the individual say 200k. A creditor, bank or liquidator can claim against that asset. This could be reassigned to the creditor. Now the trust owes the creditor 200k. As mentioned above – this comes down…[Read more]

Banker wrote:
 OK but trust assets are different to beneficiary loans. Beneficiary loans are an asset to the individual / debt to the trust. If the individual goes tits up the courts can seize their asset. Including reasignment of monies owed to them. Plan B is different – as I outlined above with a builder. Trading companies have different…[Read more]

To expand on Plan B from above. Company trust structure owns business assets. Dad is the sole director of the trustee company. Mum owns the house and all personal ssets in her name only. Dad is sued as director of company, along with the company itself. Mum can't be sued, as she has no involvement in the business. Let's say Dad loses. He has no…[Read more]

Sure, a trust won't protect you if a guarantee is taken by the bank. That is a given.I disagree that the trust property is at risk if the individuals are sued, in most circumstances. If there has been some transfer of assets to the trust, for the main purpose of hiding the asset, then the trust structure probably won't work. This is the same…[Read more]

What about if the company as trustee is successfully sued? The assets of the trust are then possibly at risk, but the family home and other assets held by the individuals are generally safe. Surely this is a major benefit of having the assets in a trust.Your second problem is not really a problem at all. Most trusts are family trusts, where…[Read more]

wealth4life.com wrote:
67% of the recent buyers are from overseas and they won't live in the property.

Do you have a reference for this? It sounds very high.

No, there is no GST.

kong71286 wrote:
From my understanding you have a 'company' that acts as trustee on behalf of your 'family trust' to purchase a 'property', whereby you act as the 'guarantor' and also lend the company the 20% deposit costs. What I don't quite understand is how the taxing system works I.e. Is the rent from the property considered the company's…[Read more]

propertyboy wrote:
So how long do you have to live in it after settlement for it to become your main residence? Which bit of legislation outlines this length? Where does it say 6 months? And how do you go about registering it?

As I've said before, there is no set period of time that you have to live in the property, for it to become your…[Read more]

casanovawa wrote:
I just want to clarify as the couple of places i have read up on this, even on the ATO site to me wasn't quite clear.  If you move in for 6 months and then move out for 6 years is that the only period that you can use the 6 year rule?  Or could u move in for 6 months, rent out for 6 years, move in for 6 months and then rent o…[Read more]

Here's an article from 18 months ago. http://www.heraldsun.com.au/business/barefoot-investor/lambs-to-slaughter/story-e6frfim6-1111117848906EDIT:And an even better article from 3 weeks agohttp://www.heraldsun.com.au/business/barefoot-investor/watch-out-sharks-about/story-e6frfim6-1225846168604

propertyboy wrote:
^thanks for your help, but where does it say you have to live in it straight after settlement? If you have a 6 year exemption, why cant you just rent it out from settlement then move in within that 6 year period? Which section says you have to move in straight after settlement? I cant find this anywhere.Why would it matter if…[Read more]

$45,000 is a lot of money. Would you be better off putting that towards a deposit? No-one can guarantee a 10% return. It sounds like b-s to me, but I'm pretty cynical about these type of 'arrangements' that require large up-front payments. I'd be doing my own research, and putting the 45 large towards a new IP. Just my 2 cents.

Depending on what state you are in, there may be a stamp duty cost. Personally, I wouldn't bother. That's just my opinion, and I'm sure others will have differing opinions. My wife and I have both our PPOR and IP in joint names.