Scott,

Thanks for the info. I hadn’t thought about terraces, although I did live in one for a while in Enmore.

And I have to say, for some reason I was thinking of Enfield, not Enmore [blush2] (perhaps because it’s closer to where I live now and I go through there quite a lot).

GP

Laurence,

I have never heard of them, but I’m wondering what is the supposed benefit of having one, compared to a standard discretionary or hybrid trust?

GP

Roofarmer,

I have no idea about contacts, but I’m wondering what sort of building is on a 5.5m wide property. If it had the usual gaps to the boundaries, then the building would only be about 3.5m wide.

And I would have thought a 330 sqm property would be too small to subdivide (but that’s only my impression).

GP

Originally posted by murph38:
I have lived in the house for about one year
But owned it for two years? What was happening with it for the rest of that time?

If it’s only ever been your principal place of residence, then I think it should be CGT exempt. However, if you were renting it out for some of the time, then it would probably be different.

GP

Terry,

Just noticed in your earlier post you said:

Hybrid trusts can’t really distribute losses, they work by the trustee borrowing to borrow units in the trust.
From my understanding, it doesn’t have to be the trustee borrowing the money. I believe anyone can borrow money and then buy units in the trust, although I don’t know how closely…[Read more]

Glenn,

Just a general comment…

It would depend on your complete circumstances, like if you’re intending to buy more properties in future, whether you’d be the only beneficiary of a trust, whether you’re likely to have other sources of income in the future, whether you’re expecting cashflow to exceed your daily needs, whether you’re planning on…[Read more]

Originally posted by agile:
Not sure why you would need a surveyer at this stage unless maybe you were planning on subdividing your land
A quantity surveyor can do depreciation schedules.

GP

Hi Chris,

Originally posted by masteraccountants:
You are probably aware that the ATO will not allow you to claim for your NZ rental property losses
I just saw this (I haven’t been here for a while) and thought that this was no longer the case.

According to ID 2002/764 in the ATO legal database:

Issue

Is the taxpayer entitled to a deduction…[Read more]

One important point that Terry didn’t mention is that with a company you lose the 50% CGT discount for assets held longer than 12 months.

If you’re investing for capital gain rather than just income, then that can make a big difference.

GP

Geo,

If you write it down as an algebraic equation then simplify it, the answer is just the phone number you started with.

If you want to see the maths, if you say the first four digits are ‘x’ and the second four digits ‘y’, then you have:

(250(80x+1)+2y-250)/2

which simplifies down to:

10000x+y

which is the original phone number.

GP

Redwing,

BlackIce is a personal firewall but Steve Gibson has always had a thing against it – probably for good reason. I’ve always used ZoneAlarm myself. XP has a built-in firewall if you want to use that, although ZA is probably better.

SP2 for XP has only just been released. Personally I wouldn’t install it until it’s been around for a while.…[Read more]

Originally posted by Still in School:
actually you can now leverage up to 75% on most bank shares
If you have a LOC against your home mortgage with enough unused limit, you could effectively leverage 100% for buying shares, with no margin calls and at mortgage rates rather than margin lending rates.

Of course if you lose money, it’s going to take…[Read more]

Originally posted by Pursefattener:
Why is it that trusts only last for 80 years?
To comply with a thing called the “rule against perpetuities”.

Google it and you’ll get the idea. Apparently it’s a rather complicated piece of law.

GP

Originally posted by swinys:
Can either of you suggest an accountant who is knowledgeable on cross border tax issues?
Not in Australia, but one I had recommended to me in Auckland is Chris Raynal at Master Accountants:

http://www.masteraccountants.co.nz

He used to be a CPA in Australia specialising in property before moving to NZ a few years ago…[Read more]

You could also try asking here:

http://www.propertytalk.co.nz

GP

Originally posted by WallFlower:
Seperate Tust, Seperate Corporate Trustee??
I don’t know that you’d need a separate trustee company, but something to ask about.

Another $2000 to cough up and were off and running?
I think you have to compare it to what you potentially could lose otherwise if the business failed. Consider it an insurance premium.

GP

Derek,

both investment vehicles, over the long term, are effectively ‘neck and neck’
But are those performance figures based on all properties and all shares as an average?

Given that astute investors would only buy a fraction of the available properties, and only specific shares a certain times, do the averages for the whole markets mean much…[Read more]

James,

Another good book on trusts is Nick Renton’s “Family Trusts”. The latest edition is only a few months old, and it’s much cheaper than Dale’s book (although Dale’s is very good).

My understanding of trusts is that any profits in the trust at the end of the financial year have to be distributed to beneficiaries, otherwise I think they’re…[Read more]

WallFlower,

Because the trust running the business is relatively high risk, so you want to keep it separate from your passive investments.

If the business goes belly up owing $1m, you don’t want the liquidators selling off your other investments to pay the creditors.

GP

Originally posted by gloryboy:
Everything points towards starting a company and establishing trusts under it.
Depends on exactly what you mean by this.

If you mean buying the properties in the trust(s) and using the company as the trustee(s), then I gather that’s a common scenario.

However, buying appreciating assets in a company is generally…[Read more]