Cata is technically correct, however, the term “Family Trust” usually refers to discretionary trusts. I doubt that anyone forming trust these days would form a discretionary trust limited to family members only, however, there are a lot of accountants out there who do not know anything about trusts.

If John’s trust is in fact a discretionary trust with beneficiaries limited to family members only, then it may still be possible to distribute to a company controlled or owned by family members.

John, just have a read of your deed. Look under the beneficiaries section, and see if it includeds any company in which a beneficiary is a director, shareholder etc.

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Excel. It is simple to draw up a basic spreadsheet, and easy to track. No need to buy anything else.

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Have a serious look at Hybrid discretionary trusts. They are very good for holding property as they allow you the benefits of negative gearing plus a whole range of other benefits.

There are a few newer books out there, but one of the best and easiest to understand is Dale Gatherum Goss’ “Trust Magic” http://www.gatherumgoss.com

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Hi Kiwi

Sounds not bad. Would you consider renting to someone who is going to on rent this place out? If so, what would the market rent be like there?

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Sorry, That was the rate before the rise, it would be 7.19%

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Good point Magellan. I didn’t even consider the land tax issues! However, this should be minor compared to the CGT savings – except maybe in a flat mrket.

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Hi Wendy

If you are using a trust that is good then. At least with a trust you have the option of distributing money to a company or a person – if you happen to keep one longer than 12 months.

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I have a couple that I have saved, tho never used. please send me an email and I will send them onto you – cannot attach to a PM. You can set one up properly on line at http://www.lawcentral.com.au

Also please get advice on using a company to buy property. It is probably not a good idea as you don’t get the 50% CGT discount. A Trust would be better.

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Why not get them to pay the stamp duty.

Or have a separate loan agreement with them. It is just a loan really isn’t it.

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“How You Could Build A $10 Million Property Portfolio In Just 10 Years” by Peter Spann

http://www.dymocks.com.au/Search/Search.asp?Author=Peter%20Spann

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