In the process of establishing what trust structure might best suit my long term requirements. Have been doing many searches on this and other forums as well as ordering Trust Magic.
Whilst there are potential tax advantages for a family or couple to establish a trust, what, if any, are there for a single. I am not discounting the primary reason for doing this is asset protection, however, I am currently negative gearing, and from my initial readings, there wouldn’t be anything substantially more from a tax view that I would gain.
A Hybrid Discretionary Trust allows a individual to negative gear. Can you still undertake a S15-15 variation to your tax or is the tax refund claimed at end of financial year, when undertaking the trusts tax return? Obvioulsy a cash flow implication if I cannot vary tax throughout the year.
James
James
I suppose one of the biggest advantages is, if your family composition changes (eg wife, kids come along), then they will usually be beneficiaries of your trust. The deed is generally vague and lists yourself, and any spouse, children etc.
Another advantage is a company can also be a beneficiary. So if you make soem huge gains and would pay more than 30% tax by distributing it to yourself, then you could setup a company and distribute to that company which would pay 30% tax.
So you have great flexibility with Trusts.
I haven’t got a hybrid, but owuld imagine you can apply for a variation in your tax.
Terryw
Discover Home Loans
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
may be at this stage the trust is not full benefit to you now but it will in long term.
Warm Regards
ChanDollars
[Keep going, you’re on your way to Frolic Freedom!]Terry, if you want to get the profit into your own pocket, you once again have too pay tax on it again. so where is the advantage
Go for Hybrid Discretionary Trust! not sure about 15-15 but I think you have to get tax at the end of year if you are using H-Trust.
Cheers
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PropertyGuRu
I want to be billionaire! [] James, I have no spouse or kids but have a family trust. My parents, siblings, and any nephews, nieces and spouses of any of those are also included, as will be my spouse and kids.
I too am negative gearing – although that will be hard to do without a job shortly[8] – and so am only buying positive investments in the trust. I also doubt very much that i will transfer any of my current assets in. CGT and Stamp Duty would be killers.
Rob-wa, if you send the profit to a company, and even in the trust, there are many expenses that you can legitimately claim as other than income, and therefore are tax free. If the money is tax paid in the company, you can also organise your affairs and decide when to take the money at a later date. I think you MAY also be able to loan yourself the money from the company, but I would definitely see your accountant before attempting that one!
Cheers
MelHi georgisj,
Could you tell me how much to set up a Trust? Which Accountant or solicitor you preferred?Regards
Julain[]THERE IS ALWAYS A BETTER WAY!
Julian,
I am not totally sure of the specific cost. I have seen costs on the net of between $500-$700.I will be going to see Gatherum Goss accountants to discuss these issues once I have read a little more about them.
James
Hi georgisj,
Could you tell me what’s going on later after you getting more details of cost involved.Thanks
Regards
Julain []THERE IS ALWAYS A BETTER WAY!
Thanks for all your responses.
Interesting to note that on another forum, I did not get one response to this question. Thanks again.
James
Dale GG is fantastic. His fees are also very reasonable. But I can tell you now you won’t get better service anywhere. It never ceases to amaze me how quick Dale is to always get back to me with answers.
And for trusts he is right on the ball.
I can’t recommend anyone more highly.
Regards – Gordon
It costs from $275 to $2000 to set up a trust. You could do it online, or pay an accountant (who will do it online). Check out this one:
http://www.LawCentral.com.auTerryw
Discover Home Loans
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
Many Thanks ,Terryw
Julian
THERE IS ALWAYS A BETTER WAY!
I think you can’t create Hubrid trust online one should see accountant before creating trust.
Cheers
[]
PropertyGuRu
I want to be billionaire! [] please tell me who is Dale GG
it sounds like a race horse[]Yes, It’s a Horse name ! Ithink ????????
Julain
THERE IS ALWAYS A BETTER WAY!
Yes, he won the 5th out at Cranbourne last week, in a Group 2.
But he is also an accountant in Melbourne – http://www.gatherumgoss.com.au
James
The Guru is correct, you can’t actually get the hybrid online at the site I mentioned. There is another site that offers these, but I have heard they are not very well prepared. So if you are after a hybrid, it is better to go to Dale GG for these, or someone else
Terryw
Discover Home Loans
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
James,
Check with your accountant, but I was advised that if you have a trust you have to pay land tax in your IP, which is 1.7% of the value of the land you hold. In my case, it was going to take a big chunk of my profit!!
Leo.Leo, that’s true. You don’t get the ‘threshold’ that individuals do, but I still think that that is a small cost to pay for the flexibility of distribution of the profits, and asset protection.
Cheers
Mel
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