I was wondering if you could give me some advice. My parents are about to move over from New Zealand. They are selling their house and will live with my husband and myself for a short time, until we all decide if they should buy or rent. Rather than them buying a house outright and spending all their savings, we thought of starting up a Family Trust fund with my brother as well. We are thinking if mum and dad put say so much money into the trust fund to invest in a house and as both my brother and I have our own houses, we could use those to secure the remainder of a loan, so that mum and dad can live in a house that is owned by the trust. We see this as a way of preserving my parents money as my father is very concerned about paying out rent money which will reduce our inheritance. Well I am not bothered about the money, but do see the point of giving him ‘peace of mind’ and making their money work for them and not go to waste. Is a Family Trust the way to go and should we invest as we have mentioned above. I look forward to hearing from you. Regards
coopsd
The trust may end up making a profit and, hence, tax would be payable. There may also be land tax and CGT later on if sold.
If they bought in their own name then they would have the land tax and CGT exemption.
On the other hand if they are paying rent they may be able to get rental assistance if on the pension. You would also need to be careful about the set up of the trust as centrelink can deem the trust property as their own if they control it.
Depends on the long term goals i think.
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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