I realise im repeating questions others have asked but im trying to fully understand a range of issues.
My wife and I have just set up a family trust that controls her small business. I work for another employer and earn $60K while she only pays herself (according to recent ATO figures) $35K. The trustee for the family trust is another company where my wife and I are joint owners and have equal shares. We have a PPOR worth $500K and ciurrent loan of $400K. We want to start investing in property particularly capital growth properties (therefore -ve geared) and not sure how to set evertything up and put us in a situation to start investing. It has been suggested:
a) sell PPOR property to the trust or possibly start a HDT and sell it to that trust to claim interest deductions and then purchase another property with 100% LVR??
Not sure if this makes sense as it is late and eyes are closing…if anyone has any ideas and suggestions please post or even links to relevant posts or articles.
HELP IS NEEDED
DebdenNot sure why you would want to sell your PPOR, unless you were wanting to move to a new one. If your PPOR is held in a trust, you may be able to save a bit of tax initially, but you will be up for Land Tax each year and will lose the CGT exemption status on the house.
HDT are not as good as they were once thought to be. But because you are self employed you could set up a Discretionary Trust and divert profits from the business trust to this trust to offset the losses.
I think you need to talk to a good accountant – one that understands Trusts (not many do).
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
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