Hello,
I am planning my trust and am a bit confused about how you actually get money into the trust.
I have a home loan and want to redraw the cash and obviously “give” that to the trust.
If I setup a hybrid discretionary trust I can “buy” units. The loan interest will be tax deductible as it was used for income producing purposes. But if I buy units, don’t I own the units? And if I own them, can’t they be “repossed” should I suffer litigation?
For a normal Family Discretionary Trust, you can “gift” money to the trust. If I redraw and “gift” the money, is the loan interest a tax deduction?
What is the best way to redraw from a home loan and transfer the money to a trust?
Thanks for your help!
you loan it to the trust, it gets recorded in the meetings that you as an individaul is loaning x amount to your trust for the purpose of….
your accountant or solicitor would set this up for youWe buy properties in Adelaide. Immediate Cash Settlements, No Real Estate Agents, No Fees.
[email protected]
phone 0412 437 582I’d strongly suggest you get Dales book’s Trust magic and Tax Battles they are essential reading if you are looking at this structure..
Ed Burtons book is also a good read, so is Rentons..I’m waiting for Ed Chans..It’s a complicated beast that many accountants don’t even fully understand, so its worth becoming a bit more informed..
Plus..not every Bank will like the structures..
“Money is a currency, like electricity and it requires momentum to make it Effective”
Count The Currency With This Online Positive Cashflow CalculatorThanks for the advice.
What happens if I loan money to the trust, and someone sues me?
Should I lose litigation and am declared bankrupt, can the creditors “demand” the loan be repaid?
When a person goes bankrupt, I understand that the creditor can “undo” transactions in the last 5 years if they were designed to avoid paying debts. Could that possibly happen if I “loan” money to my own trust?
Tom
If you loan the money, then it is an asset to you. you still own it. I think you have to weigh up the tax benefits of lending vs the asset protection benefits of gifting.
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
You must be logged in to reply to this topic. If you don't have an account, you can register here.
