If you want to set up a "PIT", you need to ask some serious questions, especially about the "never ending" bit. It is true that SA is the only state with no legislation against the laws of perpetuities, but there are well established common laws against perpetuities – would these apply if there is no legislation? Are they relying on the "what and…[Read more]

It should be covered in the contract. Read the contract and look for a clause relating to this. What state is the property in?

My friend is doing this. He checked with various accountants and could not find any issues re the claiming of the stamp duty. It seems like a potentially good strategy.

ok BBBut, it may be good to have the option of the trust being able to gift as well.. I was thinking this may be classed as a distribution though and taxable.

I think gifting periodical lump sums would be preferable. Otherwise it may look like you are using the trust account as your personal monies.You dont really need anything to gift, but then it may be arguable that it was a loan. Maybe a deed of gift or at least bank transfers with the word 'gift' added.It is probably best to see a lawyer about this…[Read more]

Actually gifting is probably better than a loan. A loan always belongs to the lender, it is repayable. A gift is not. But, there are provisions under the bankrupcty act where a gift can be voided – generally for up to 5 years, but it could be indefinite if it was done with the intention to avoid paying creditors.

Hi TonyTechnically neither is really needed. All a company needs to do in signing a document is to have the director sign (if single director company):s127 Corporations Acthttp://www.austlii.edu.au/au/legis/cth/consol_act/ca2001172/s127.html

But, that doesn't mean it wasn't a loan. If it goes to court you will need evidence to prove it wasn't and she will need evidence to prove it was. This doesn't have to be written evidence.Improving a property would probably give her the equitable interest as well.Tough situation – you had better try to get advice asap.

Thanks for the update BB8You will find it standard practice to have LMI apply over 80% LVR.Having wages go into a trust account is a bit of a tricky issue. Unless these are gifts to the trust it will be mixing personal funds and trust funds. There would be various consequences flowing on from this – does the trustee have authority to gift these…[Read more]

It doesn't matter whether it is a loan or not, she has a caveat lodged. She contributed money to purchase the property so it will be very hard to remove the caveat, even if you are in the right, and probably impossible to do before settlement.And, just because someone claims an equitable interest in a property doesn't mean they need to contribute…[Read more]

Anthony, Please read the legislation referred to above. Does it refer to intention? Does it refer to holding an asset for 12 months and 1 day before CGT applies?You got it wrong I think. But that is ok, we are all here to learn. I also get it wrong sometimes (the last time was in 1987),

Anthony, in this case there probably won't be much if any CGT,but you stated above:"CGT needs 2 elements,  Intention to make a gain and 2. > 12 months and 1 day duration,"This is clearly incorrect and may have mislead other people who may be doing something similar. Are you an accountant?

TC62 wrote:
Hi JPR.OK, settle down young grasshopper.CGT works on the govt taking 50% of your profits for the financial year you sell the property in and then add this gain onto your earnings for that year. This then gives you a total earnings for that year which is then taxed at the marginal tax rate the total earnings falls into. SO, what does…[Read more]

1. You never know what will happen in the future, you may never end up moving back into property A. So it may be worth getting a valuation now when you move out. It may also be worth getting another valuation done when you sell – valuation as it was when you moved out. It may cost you an extra $300 but using the most favourable one could save you…[Read more]

I think there the ACN is generally inserted in the contracts. This is the company's ACN and is the same whether it is the company acting in its own right or acting as trustee. To avoid confusion some people but the trust's ABN down instead of the company ACN as this more clearly indicates the company is acting as trustee. But legally all you need…[Read more]

smlDid you get a valuation of your business before doing the transfer?CGT will need to be assessed at market rates on the transfersee s116-30 ITAA 1997http://www.austlii.edu.au/au/legis/cth/consol_act/itaa1997240/s116.30.html

It looks like we are dealing with the transfer of a business which was previously run by a company to the same company in its capacity as trustee. A business would be a CGT asset and disposal of a CGT would trigger CGT – it would be CGT event A1 I presume. The 50% CGT discount may be available if the business was held by the company for more than…[Read more]

Wow, what a potential mess.The mum has an equitable interest in the property as she contributed to the purchase. If it goes to court then it will be you arguing it was a gift and her arguing it was a loan. What evidence do you have that it was a gift? and What evidence does she have that it was a loan? I think it will be cheaper just to agree to…[Read more]

Here is the main reason not to cross collateralise:Imagine you have two properties. Each valued at $100,000 with a loan of $90,000 each. ie 90% LVR, with the two loans cross collateralised.Now imagine you get into some financial trouble. You must sell one or both properties to reduce your monthly expenditures. But the values have dropped or you…[Read more]

If you really want assistance from your parents then maybe they could set up a LOC and they could lend you some money. This would be less risky for them and easy for you to use this to remove the guarantee.