Where did you ‘pull the equity’ to?

Companies get a separate land tax threshold in most states and they can retain earnings too so they can be a great way to own property – tax can potentially be less than that in your own name.

Your step dad’s company can lend your company money and can secure this by taking a second mortgage, either registered or unregistered. This should help…[Read more]

You should get some legal advice as there are many ways to structure this both inside super and outside. It might be advantageous to set up a second SMSF for example.

I believe it is just a marketing term – the name doesn’t really matter. If you want asset protection on bankruptcy you should really get legal advice (from a lawyer) because the trust deed is only one part of it. The important part is how the transactions are structured.

For example if you make a ‘gift’ without anything changing hands the gift…[Read more]

One additional thing – what will be the consideration fro the sister becoming legal owner. Will it be a gift or will she be paying market rate for the property, or even undermarket rate. This has far reaching tax and asset protection and estate planning issues.

See legal advice!

Why cannot she give legal advice? Perhaps because a conflict of interest. If she is operating a business selling products then she may not want to advise on those products because it could be deemed biased.

You should get some legal advice on the consequences first and decide how the property will be owned – JT, TIC in equal shares, TIC in unequal shares.

Then egage a conveyancer – which may be the lawyer you used above.

sister will pay the stamp duty on the value transferred to her.

It will be a CGT event to you and/or husband who are…[Read more]

Impossible to advise on such a general question. Best course of action may be to start reading as much as you can.

that is like asking “what should I eat for dinner”

It depends is the best answer.

Yes gift him $20k extra so you can borrow $20k extra could be a good idea – but get tax advice, especially on Part IVA

In that case you would want to borrow as much as you can and you should get some tax advice about how to maximise the loan (in conjunction with advice from your mortgage broker). I don’t really understand what is going on from your post.

If you have $20k to give your dad why not just use that yourself?

Guarantor

Why do you need to contribute $20k? Is it because of servicing or because of security?

Did you record their conversations without them knowing? This could be a criminal offence.

What does the contract say about the refund of the $1000. It probably don’t matter whether they said it was refundable or not.

Department of Fair trading would be the department to complain to about this as they regulate agents and not ASIC – were you…[Read more]

It could be CGT exempt for your daughter – but the rest of the owners will be liable for CGT – if there was a gain.

why do you say that?

Interest on money borrowed to pay interest can be deductible – This was said in the High Court case of Hart. The ATO even admit it is deductible if the underlying interest is deductible.

But Part IVA ITAA1936 can be used to deny the deduction if it is a scheme with the dominant purpose of making or increasing a tax deduction.

So what is your…[Read more]

Taking money from redraw is new borrowings. The purpose of the original loan was purely to acquire the property (assuming you have made no increases and never redrawn). If you redraw the purpose of that new loan is to pay interest. If the interest on interest is deductible then it all relates to the same purpose – the property. But if the interest…[Read more]

Taking money from redraw would create a mixed purpose loan.

SB – have you had tax advice on number 2?

This would involve borrowing to pay interest. Interest would be deductible under s8-1 normally, but considering the ATO’s ruling on this they may apply Part IVA to deny the deduction.

Also from a loan point of view there would be few lenders that would allow a loan to capitalise like this without it…[Read more]