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  • Profile photo of klublokklublok
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    @klublok
    Join Date: 2009
    Post Count: 2

    Whatever you do, DO NOT buy properties in a company. As mentioned earlier, from a tax perspective there is no CGT discount for a company for selling assets. Further there is no protection for your property either.

    Presumably you will be one of the shareholder of that company, which means that should you go bankrupt, your creditors can seize your shareholding – which means they effective get your property anyway.

    Best arrangement for your situation would be to hold your property in a discretionary trust with a corporate trustee. The shareholding in the corporate trustee needs to be carefully thought out – best if your family is involved so that they own a fair portion of the shareholding of the corporate trustee. Make sure that you are not the sole APPOINTOR of the trust.

    Your property management company can then pay rent to the discretionary trust which can then be distributed to you or across your family.

    Have you thought of buying the property in super?

    Profile photo of klublokklublok
    Member
    @klublok
    Join Date: 2009
    Post Count: 2

    Don’t forget if your overall net wealth (excluding super and your home) is under $6M you can get access to the small business concessions for CGT. If that is the case then there should be VERY little CGT on this restructure.

    In relation to the actual holding entitles – I think it is best if you have a DT holding your shares. This way you do not have to run into issues as to who is going to be the appointor(s) of the (presumably) corporate trustee of the new DT.

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