We operate a Pty Ltd Company and over the last 2 years we have purchased 2 IP’s. Our accountant’s advice was to purchase the IP’s in the Company name, ie the CO. owned the IP’S.I have received other advice saying that this is not the best structure to use,as family trusts etc. may be a better alternative. I would appreciate any suggestions you may have.
One benefit of owning income producing assets in a trust is the TAX advantage, in that all income is passed on the the trusts beneficiaries and then taxed at there marginal tax rates. Whereas all income a Pty Ltd makes is taxed at 30%.
As the trust profits are distributed, the
a CGT discount is also avaliable. That is, if the asset is owned for more then 12months a 50% discount of that profit is allowed.
Where as Pty Ltd’s are not entitled to any CGT discount…
Ok…its a little early here so my brain isn’t at full capacity…
But I am a little confused by
quote:
is the CGT the same in a trust within a company ?
Are you saying the trust is the beneficiary?
In this case no, as the profits are taxed at their level and they are not entitled to a 50%discount. However if another beneficiary was an individual they would be entitled to the discount on thier portion of the profits…
You gotta get that Wealth Guardian out on the streets, I feel so fortunate[] to have received an early copy but sorry[] for those that keep asking this question.