Our business partners and my husband and I have our Companies established which we are using for our Self Managed Super Funds. We are about to purchase our first investment property in Qld and our accountant is in Sydney.Our accountant advised us that when we purchase our first IP, he will then set up our trusts. He was not sure if the ruling in Qld varied from NSW but does anyone know if we would purchase the property in the Company names and then nominate the companies to be the trustee? I will seek info from a Solicitor but thought someone might be able to help.[
]Hi Little Mermaid
In NSW you can not use “and/or nominee”, so the name you put on the Contract for Sale can not be changed.
So if you purchase the IP in the companies name you can not add the words “as trustee for …..” after the company, it cannot be owned within the trust structure.
However is Qld, (I think) you can. So, you should purchase the property with “and/or nom.” on the contract for sale and then have the trust setup.
I have setup a few companies over the past 2 years and on one occassion it only took 4 hours for everything to be done. There are many companies in Sydney that specialise in this, the one I use is Patricia Holdings http://www.patricia.com.au
I would suggest you advise your accountant you want one setup straight away and you might be able to avoid any problems
Happy Hunting
WHJ
litle mermaid, I don’t know a great deal about buying in the company names and transfering them into trustee accounts but if you are using the companies as trading accounts you may be exposing the properties to potential liability in the event of claim against the company depending on how the company operates.
Hi there
Could I suggest that you never ever ever mix a trading activity with a holding activity as this may put your long term buy and holds at risk from litigation. The more you can separate your trading activities from your own personal affairs the better!!!
Ask your accountant about this and if he/she says it’s OK to mix activities, change your accountant!!!!
Take care
Dave []
In NSW you can not use “and/or nominee”, so the name you put on the Contract for Sale can not be changed.So if you purchase the IP in the companies name you can not add the words “as trustee for …..” after the company, it cannot be owned within the trust structure.
Hi Whj,
If you can’t buy a property “abc company as trustee for xyz trust”, why do accountants recommend this corporate trustee structure when buying IP’s?
This is quite new to me as I have been told by people that this is ok to do. I would appreciate you telling me where you heard this as I want to clarify what is correct.
Cheers,
Mathew.
Hi Matthew
In NSW we cannot use “and or nominee” when purchasing purchasing property.
If the property is purchased in the name of the company and the trust has not been setup at the date of signing the Contract for Sale, the trust can not be added into the structure later.
So, in the contact for sale if the trust has not been setup the purchaser will be XYZ Pty Limited. Even if a trust is setup at a later date the name on the Certificate of Title can not be simply changed to XYZ Pty Limited atf ABC Trust. As this is a different entity the stamp duty will have to be paid on the market price of the property.
So what I was suggesting was to ensure the Company and Trust was setup prior to purchasing the property and signing the contract for sale.
WHJ
Hi Whj,
Thanks for clearing that up, you had me worried for a minute there [
]Cheers,
Mathew
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