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Leabee, unfortunately there is no one single answer to cover this issue. Like Terryw I have been playing in this field as a tax accountant for several years and agree that there is something new every day and many accountants and lawyers have difficulty with trusts.
There are just so many factors that it isn’t possible to have a one size fits all. In many instances the actual structure you choose depends on how you purchase the property: IE with or without borrowing. Once you borrow to purchase, then if you are looking at negative gearing it isn’t going to work as the tax rules on deductions against discretionary trust distributions are very limiting. If you borrow independently and then lend to the trust – you haven’t protected the asset.
If you are borrowing, then holding property in a trust generally doesn’t work for everything. If not borrowing then it works well but does have the land tax issues.
You need to determine what is the most important parts of the investment. Is it (just to name a few):
asset protection
negative gearing benefits
capital gains distribution
ownership and ability to draw down on equity
death benefit and transfer.
PLus costs EG annual land tax ( and stamp duty if thinking of changing to a trust)And as Terryw says, a trust is not the only option.
And you will NEVER get the main residence exemption in a trust.
Good luck on the quest for a cost effective professional who is also knowledgable. (Maybe Terryw is the man)
Its one of those things that can change depending on how the property market moves and you would really only need to decide when the 6 years is up or when you sell, if within 6 years. I would get a market valuation on Melbourne when you move out, as it ceases to be your PPR so CGT would only be on the increase after it ceases to be your PPR – so get a good high valuation. You can chop and change which is the PPR to give you the best CGT position, but you wont know this until you actually sell.
