Thanks Jacq

I could view that page even without being a facebook member.

There is a link on that facebook page to a private binding ruling from the ATO:
https://www.ato.gov.au/law/view/document?docid=EV%2F1051448104408&fbclid=IwAR3zSnp9aviI6ahdprn3ovHXEfpX8Z9v7O5pAZKFwzJ7PnJ79PgKLbnPlIc
Authorisation Number: 1051448104408

These rulings only apply to the person that makes the application so they cannot be relied upon by others, but they are good to read as the ATO will answer and explain their answer.

It seems this applicant entered a deed which assigned their equitable interest in assets, possibly land, to the trustee of a discretionary trust. It is well known, common knowledge, but tax practitioners that this would cause a CGT. Change of legal ownership won’t but change of beneficial ownership will.

But merely gifting ‘cash’ to a trustee and borrowing it back will not be a CGT event because cash is not a CGT asset.

From what I have seen it would be unusual for an asset protection lawyer to recommend an assignment of an equitable interest like this.

This private ruling may not relate to the Grubisa system.

Jacq wrote:

Hey there,

What ended up happening?

I’m really unhappy with the service. I signed up too.

Check this FB page if you are still having issues. There is new light being shed on Capital gains tax – equitable interests – transfer of assets to trust. New ruling from ATO.

Cheers

What is the link for this please.

Hi Property Buyer

I will try to squeeze you in, I think you may have emailed me but I am not sure of your real name now so could you please send me another email with your phone number and I will give you a call.

Not really my area of interest, your conveyancing lawyer should be able to advise.

Will be hard to get a loan with a family member providing a security guarantee if they are not benefiting from the property. ideally you would get the family member to borrow and lend to the entity purchasing.

Commercial generally needs at least 30% deposit plus closing costs so it can eat up a lot of your equity/cash. Also can be harder to borrow against any increase in value compared to residential.

Where will the deposits come from?

That is really a personal decision with a bit of growth predictions thrown in.
Selling one property to buy another will generally eat into about 10% of the value, assuming CGT free, as you have agents fees, stamp duty etc.

But it could work out better as you would be saving non-deductible interest.

Consider some alternatives such as a related party sale.

i can’t give you complex legal advice on a forum, and even in private I wouldn’t advise on foreign trusts and tax as it is not an area that i work in. As one example, consider the tax consequences if a settlor can benefit from a trust.

Another example is asset protection – you being an intermediary opens a can of worms.

Steven wrote:

Terryw wrote:

Who is the borrower?
You or a company?
If it is the company, why is the money going into your account?

The corp trustee is the borrower.

Reason for considering to transfer to me first and than having me to transfer to the corp trustee is more from an ease of management point of view.

My parents are old folks and it is a hassle for them to transfer money to overseas. For example, ANZ now days no longer does overseas transfer across the counter any more, and you must call them on their support line to do an international transfer. While ANZ has good business reasons to do it this way, it just means more hassle for old moms and dads, so its much easier for them to transfer it to me and then let me handle all of those hassle.

Or it could be that money is not transferred directly from a personal bank account to the corp trustee, but instead is done via one of those money transfer entities such as XEMoney (who offers money transfers to overseas with more attractive rates compare to normal banks). In this case then everything is done online and again, it is a huge hassle for old moms and dads due to them being computer illiterate to do that, so it is much easier for me to handle those situations. (unless they are willing to share their banking passwords with me, but I would never ask for such as this is their private password and they are not supposed to share with me!)

sounds like you are the borrower to me.

Sounds like a host of legal issues too.

I think you didn’t understand my previous post as I answered these.