Forum Replies Created
Any takers?
Shar
Hi Xenia
I also had a lot of trouble getting info on the best way to buy ppties in NZ.
I have now bought them in a NZ Family Trust, however, you have to be careful that you don’t control the TRust or the ATO will consider it as being an Australian Trust and therefore need to put in a tax return for the Trust in Aust. What I have done is set up a NZ Trustee Company to be the Trustee of the Trust with the directors and shareholders of the coy being my NZ solicitors. No-one seems to know for sure if this will satisfy the ATO as needs to be tested by them for sure. (I did speak to the ATO but they don’t even seem to know).
I wasn’t trying the avoid paying tax in Aust, but just wanted asset protection. However, I do cringe at having to pay accountants fees for tax returns here for a NZ Trust.
If only buying one or two ppties in NZ then I wouldn’t have bothered and just bought in our own names. AT least it is cheap to transfer the ppties to a Trust over there as there is no stamp duty etc.
SharI believe anyone can go to their meetings. If you look up their web site theinvestorsclub.com.au they should have the meeting dates as they are held all over Sydney.
I went to one of their meetings a couple of years ago and were quite interesting. By what I have read about them, if you are too hesitant to get into property investing on your own and need an organisation like this, then they are probably the best. However, if you do your research, you are probably better off doing it on your own.
Shar
For any of you Forumites from Sydney who frequent the Propertytalk.co.nz website, Marc from PT says he is coming to Sydney in May and is interested to meet at a pub one evening. Could be interesting for a chat.
Shar
Hi Andrew
I really couldn’t say how long it took as actually bought 2 properties while in the process of setting up (which were bought in the Trust name). Also wasted alot of time to-ing & fro-ing with emails to solicitor and accountant in NZ, speaking to Sydney accountants and ATO trying to work out if it was the correct way to go. Probably took about 4-6 weeks in all. However, I reckon you could do it in a couple of weeks if you know what structure setup you want from the start.
Cheers
SharHi Aptam
My costs were as follows:
All NZ $ plus GST
Setup Trust $850
Setup company $600
Transfer property to trust $600 each
Ongoing administration costs approx $500p.a.Shar
Have recently set up a Family Trust in NZ to buy properties. However, the ATO says if you have control of the trust then it is deemed to be an Australian Trust and will need to have tax returns done here as well as in NZ. (I think this is to stop Australians hiding income in overseas Trusts).
To overcome this, we have setup a NZ Corporate Trustee to be the trustee of the trust and have our solicitors as the directors/shareholders of the Corporate Trustee company. This all seems to be a very grey area and no-one can tell me for sure that the ATO will accept this as being controlled by NZers and not Australians, but hopefully it won’t be tested.
Ultimately as we are the appointors of the Trust, we haven’t lost total control of the Trust as we can of course sack the Trustees if we are not happy with them.
If you are only buying 1-2 properties in NZ, then I don’t think it is worth setting all this up but if buying afew then it is worthwhile.
The good thing is that as there is no stamp duty in NZ, you can buy the properties in your own name initially and then transfer them to the Trust at a later date at not too much cost.
Hope this helps.
Shar
Foundation, you just gave me a huge laugh – and I’m a Kiwi! I daren’t ask you to elaborate!
Nobleone – possibly the problem you have with tradies at present is because of the housing boom in NZ – builders and all others tradies are flat out with work. Things should improve as the housing boom slows down and then I think you will find the NZ tradies are very reliable.
Shar
Thanks Yack
I’m hoping to go there in mid-June but am trying to get as much info as possible before then.
Shar
Oh, and I forgot to mention the FRESH CREAM cakes!
Fat Shar
I have to say that last time I was in NZ I was a little disappointed with some of the fish shops. Not as good as they used to be. However, I did manage to find some battered oysters – now there is a taste sensation!
And the ice creams are as huge as ever!
Shar
Hi Robot
I’m originally from Taranaki and when I was over there late last year I looked around New Plymouth but the prices had risen too much for a decent rent return. I had thought I might get something in Inglewood as I remember property being pretty cheap there but the prices had already risen too much.
Sadly I looked at Hawera but there was nothing worthwhile the day I was there so I didn’t pursue it. Now prices have taken off there – if only I had looked abit harder then!!
Shar
Thanks Dazzling for starting this wonderful topic! I’m another one with the same problem of an uninterested partner and I’m truly amazed at how many others share this problem.
Out of all the wonderful information I have obtained from the Forum, this topic has been the one that has inspired me the most!
And the best reply for me was the one from Skippygirl who mentioned the fact that the wives of the gurus whose seminars she went to were nowhere in sight. This seems to be the case with alot of successful property investors and this fact more than anything has inspired me to keep going!
Shar
I have seen it at our local newsagent in Baulkham Hills, Sydney. However, I subscribe to it and find it invaluable for the information and statistics and thoroughly recommend it if you are thinking of investing in NZ.
Shar
Hi Kiwi Fulla
Have you checked the KPI magazine. They have heaps of interesting statistics every month.
Shar
Hi Sara
We were also seen as “maxed out” by banks here in Oz.
Wanted to start investing in NZ so applied to ANZ in NZ and got knocked back. Also applied to Premier Mortgages over there but were also knocked back.
Then tried Mortgage Link in Taranaki. They got approval from ASB there for us to buy 2 properties and then only didn’t approve the third one as they don’t normally lend on properties under $80,000. However, Mortgage Link then found us approval with a home lender in NZ and we are currently about to settle on our third property.
We have used the redraw on our PPOR in Oz to pay the deposits and financed the balance in NZ as above.
So what I’m saying is, keep trying and don’t give up if knocked back.
Shar
Slightly off track, but what about wetas and hoohoo bugs!
The first time my English husband saw a weta in the house he had to change his undies!
Weta – extra large, brown insect looking abit like a grass hopper but also looks extremely scarey.
Hoohoo bugs (don’t know spelling) or called hardbacks. Large moth like creature with hard wings like a beetle, that fly around at night. When I was a kid the boys loved catching them and chasing the girls with them!
Shar
I think a covered deck/verandah adds heaps to the feel of a place and gives you that outdoor living space.
I also love skylights! Not those little round ones that look like a light is always on in the room, but a great big one 1 metre x 1 metre or bigger preferably in the kitchen of dark houses! Makes the place so much more livable.
Shar
Hi Christopher
Thanks for your lengthy and enlightening answer!
“In answer to GP, there are some differences in NZ trust law compared to other jursidictions, the main difference being that the tax residence of NZ Trusts depends on that of the settlor, whereas other trust jurisdictions depend on that of the trustees.”
As myself and my husband have NZ tax file nos (as we would have had to file a tax return anyway with the properties in our names) does that mean we are NZ tax residents – even though we are also Aust. tax residents? Does this make any difference?With the NZ trustee coy set up, does this mean extra tax returns over and above the return for the TRust?
Shar
Hi Greatpig
No they didn’t mentioned the 50% discount.
I spoke to Nick at Strategicwealth who Simon Macks often recommends on this Forum. He is a very helpful chap. Unfortunately though he doesn’t deal with overseas investments. He put me onto another accountant who specialises in overseas income. He isn’t sure about the trust thing and is going to get back to me. He did say that he doesn’t recommend his clients who are buying only 1-2 properties overseas use Trusts as it is very complicated when it comes to tax compliance.
However,he did mention that in some circumstances now you can negative gear overseas. Something to do with some tax changes from 2001 but alot of accountants don’t know about it!
