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I agree with Dr X. I have discussed this with my accountant and he suggested a discretionary trust for the same reasons. You may not save any tax initially, but having a wide range of potential beneficiaries could help down the track. A company could also probably work if the shares were owned by a discretionary trust. But you never know, you may want to hang on to one long term and then the trust would come in handy.
Terryw
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If you are going to move into your unit, you could sell the shares and put the money into an offset account attached to the unit. You could then buy them back (using a discretionary trust would be a good idea)by increasing one of your loans and maybe using a margin loan. This will help you convert non deductible debt.
Then when you move out of your unit, you can take the money from your offset and put it onto the loan of your new place.
You will probably have to pay CGT, but it may be worth it.
Once you have done that, you could then start buying more property.
Terryw
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[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
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Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
If you find it risky to take risks, then don’t. Just keep saving what you can, and plan your strategy for when you graduate and start working.
Terryw
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[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Why would anyone want to use a mobile lender from a bank? Naturally they only have products from one lender! Most people wouldn’t bother and would use a broker who would have access to 30 or so lenders – its the same hassle.
Terryw
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Mortgage Broker
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[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Sorry Lei, I don’t know much about proeprty trusts!
Terryw
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[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Hi Jules
I think you still misunderstand. The guarrantee only relates to the loan, you can still be attached from other angles, and a trust helps protect you from these.
Terryw
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[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
A LOC is easy to use and works well. Especially for investments.
If I had a home loan with an offset account, and funds withdrawn from the offset would cause interest payments to rise, and the extra interest incurred would not be deductible.
Terryw
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Mortgage Broker
North Sydney
[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Bluestone have a new 95% low doc too:
– Rate 10.79%
– Owner Occupied only
– Clear credit report
– Minimum population requirements of 75,000 within 10kms of the security property
– Max loan is $350,000
– Must have held an ABN and be registered with GST for 12 months or more.
– No LMITerryw
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Mortgage Broker
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[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
eg. What about your uncle’s cousin who has taken one year off work to have a child? No income, so they may be able to accept a $6000 distribution and pay no tax on it. That may save you $3000 in tax.
or you could distribute to a company that you own. Companies pay a max 30% tax.
Terryw
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[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Dunno. What sort of investment was it?
Terryw
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[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
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Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
From my memory of the Dec class, he was saying (in addition to the above) that as the yields drop you could sell a property to release funds and buy two more properties with higher yields (in a different area probaly) to replace them.
Terryw
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[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
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Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Yes. It is just like buying a unit off the plan.
One of my clients became a millionaire overnight (about a year). He purchased over 10 blocks for $40,000 using small deposits. A year later they were selling for about $180,000 each.
Just bear in mind, if you are going to sell it, you won’t get the deposit for the purchaser, or the profit, until the final settlement.
Terryw
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[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
You can only get the FHOG once for one proeprty. If there are mulitple units on different titles, then you will only get it on one of the purchases. Your girl friend should be able to get it on one of the others, but you must buy separately to each other.
Terryw
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[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Mine are all positive geared, except for a land loan. What I do is pay everything from a 100% offset account linked to another IP. I put all rent and income into that account. And I pay interest on the LOC which was used for deposits from this account.
Terryw
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[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Try the local papers, and look up the vendor finance association website. They used to have a page for people advertising their services.
Terryw
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[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
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Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
You generally need around 5% deposit and around 5% for closing costs such as stamp duty. But it is possible to get 100% loans, and if you are a first home owner, and you are buying a place to live in, then you will get a grant of $7000 and stamp duty exemptions, bring down the costs a lot.
Terryw
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[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
try
http://www.mintgroup.com.auTerryw
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Mortgage Broker
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[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
If you are planning on buying a few properties, then it might be worthwhile setting up a trust to start. Any accountant could set one up, but there are many out there who do not have a clue. Try http://www.gatherumgoss.com for a good accountant who also has a book on trusts for sale.
Terryw
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Mortgage Broker
North Sydney
[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Excellent idea Derek!
Terryw
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[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
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Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Stamp duty would be marginally higher, but CGT wouldn’t be any different if done correctly.
Terryw
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Mortgage Broker
North Sydney
[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
