Hi Harry

I agree with Richard

 We recently priced up something similar for a client. Don't forget that you are creating an additional lot so will also trigger infrastructure contributions.  2 Bed in QLD would be up to $21K, legals to get consent of all the owners will not be cheap, best part of $10K and that is if you can get consent.  You may need to give them some financial incentive to do so, what benefit do they receive in agreeing otherwise?  Then you have to do the fire rating, carparking requirements,  private outdoor living space.

If you are holding it as investment, then you well get 2 lots of rates and 2 lots of body corp fees.

Seems like a good concept at fist instance, but then once you list all your costs not so much.

regards

I agree with Terry.  I think that your Trust may actually be invalid at common law.  

Setup a Trust in Australia through a lawyer and it will be properly done.

You could also get a Binding Financial Agreement done with your partner to restrict her assets to the trust. She would have to agree, it would have to be done correctly and she would need to seek independent advice.  Your solicitor would also have to be comfortable that the advice she received was sufficient.  Even then they help but are not necessarily bullet proof.

We have recently decided that, due to the terribly setup online trust and companies we see all the time, we are going to do trusts with company as trustee and basic advice as a service rather than an income stream ($1000 including outlays).  As a boutique commercial firm , we are obviously not doing this for the money, especially when ASIC fees are over $400 alone.  I see so many poorly established structures where people  have tried to setup online to save money.  We would rather make minimal money on the structure setup and spend our time helping people make money in their ventures, and build commercial relationships going forward, than trying to fix the structural problems later on.

IMHO you would be better off finding advisors who deal with options.

Brokers and solicitors on here have used options themselves, I am sure there are accountants and other professionals who have also.

regards

D

I used to  own a block of units there.  Interesting tenants to say the least.

Have a look at pdonline.logan.qld.gov.au  and search the site you are looking at.  That will let you know about flooding and waterway corridors.

D

Hi MM

Stamp duty will also be payable on the value, not the price you actually paid.  

Either way can be structured by a good property lawyer.

D

Hi Brad

Congrats on your success thus far.

Unfortunately there are also land tax issues to consider in some states.  Eg in NSW a disc trust has zero land tax threshold, whereas in Qld it is $350k (unimproved value, as per the rates notice).

If you are not buying in NSW then I am a huge fan of discretionary trusts for holding property.  Flexiblity and asset protection are outstanding in this structure.  NSW a unit trust can provide some flexibility and be transferred to super later in life.

You are right to want to pay the minimum tax, the Govt wastes so much of it I don't want to pay a cent more than I have to.

Where you are based is not as important as what state you intend to buy the property in.

D

Lee & Lee have a chermside office and also a Sunnybank office.  Tony Lee has done a lot of property stuff himself over the years and also works with a lot of developers and investors.

Ok. I do not see any houses around Brisbane for $300k.  Ipswich or Logan yes there are plenty.  

No Rule against perpetuities in SA so lucky you, or lucky grand children anyway.

Use of  discretionary trusts offer numerous benefits including:

1. flexibility of distribution of income

2. efficient tax planning

3. succession planning

4. Asset protection

Downsides include

1. lack of negative gearing if required

2. no land tax threshold in NSW.

There are more on both sides.

It is important that you surround yourself with experts who have been there and done it for themselves and then learn as much as you can from them.

3 key people

1. lawyer

2. finance broker

3. accountant

D