Renting trust-owned property back to myself???

you could but………..

The trust will own the property so only it can claim any losses. Trusts cannot distribute losses, so unless your trust has other income it won't help you save tax now – the losses will carry forward and can be used to offset future income. ie you cannot personally claim the losses or reduce your own tax.

You will also be up for stamp duty and will lose the CGT exemption status on this property.

I am interested in this structure "gift and loan bak"can you please recommend any accountant specialise in this matter  , I have 3 IPs and my PPOR under my own name for tax minimization, just set up DFT for next IP. thanks a lot
M

Hi Dave

LOL, fortunately or unfortunately, depending on how one sees it, no. That wasn't me but I do know who you are referring to though. 

If I have time to publish books, I would have preferred to write anything other than tax since I am immersed in it every day!

Eddie
[email protected]

talk to some good accountants who understand property investment – http://www.strategicwealth.com.au

or http://www.gatherum-goss.co.au

maybe advisable!

Terry Thank you so much for your advice
M

another question regarding family trust please, my DFT has a corporate trustee, the trustee company has an ABN & TFN, do the DFT need an ABN and TFN for tax return? or it can be the same ABN & TFN as the company
thanks
Mj

They don't even bother stamping them in some states – I know we don't here in QLD.

Have had some issues with some banks asking for a stamped deed – guess they didn't get the memo.

So many little hurdles to navigate through – no wonder this forum is doing a roaring trade.

Say you have a property worth $100,000 with a loan of $30,000. That means you have $70,000 exposed if you are sued.

So what you do is gift $70,000 to your trust. Your trust then lends you $70,000 and it takes a second mortgage over your property as security.

I am not sure of the taxation implications. The trust should probably charge you interest to make the transaction commercial. This interest may be deductible depending on what you used the funds for. This would in effect shift income from your personal side to the trust side. The trust can then distribute the income to the lowest tax paying beneficiaries available to it.

This will acheive tax minimisation and asset protection without actually having the property owned by the trust, or incurring stamp duty/CGT by transferring it to the trust.

Hi I'm learning about this too. I am assuming that the gift and the loan back of the $70 000 are only minute postings in the company meeting registers right. No money is actually transfered physically.