Hi All,
I’m still looking for the answer to this question.“If a loss is incurred by an asset in a trust, can you distribute the loss to highest taxed beneficiary so that they can claim the loss?”
It seems that you may be able to do this with a Hybrid Trust? Or special structure.
Does anyone have a solid answer to this….?Or can point me in the right direction to get a definitive answer.
Thanks,
Ross.
Hi Red
To my knowledge a loss in any trust, be it Family Trust, Unit Trust or Hybid Trust cannot be distributed. The loss is carried forward for the next year.
What I do know is that if you have 2 Family/Discretionary Trusts and one makes a profit and the other a loss the Trust with the profit can distribute to the Trust with the loss.
Your Accountant should be able to give you the exact answer on this.
Cheers
NessieRed
I think with a Hybrid trust, the unit holder can borrow to buy the units, and the interest on this is able to be offset against the unit holders other income. check out http://www.chrisbatten.com.au
Terryw
[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 Red,
We have just set up a Discretionary Unit Trust (Hybrid Trust) in which the individual/unit holder borrows the money and the Trust owns the property. The Trust can then distribute the income to the unit holder who can then offset the loss incurred from the loan against the income received from the Trust.
From what I know, a loss can’t be distributed by a Trust (only offset against gains of the Trust), so with the above scenario the loss is incurred by the individual/unit holder and not the trust.
Cheers
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