Thanks Jamie, but not my area of practice. I suggest you try RPI from the forum as he is a property lawyer based in Brisbane.

I am a tax lawyer in the CBD and provide advice on structures/

I recall the words “income without having to work”…

Non owners cannot go on loans – they can, but no bank will allow it.

Your best option is a reverse mortgage – not sure why you think it not applicable.

Another option is to transfer part of the ownership – but stamp duty, CGT and other consequences.

Your MIL needs some good legal advice on the consequences.

I’ve written hundreds of posts on trusts. There is also thousands of pages of good information out there – written by lawyers. Keep in mind there is also thousands of pages of misinformation out there.

See a lawyer for advice before setting up.

Make sure you seek legal advice.

You can generally can only amend 2 years worth of tax returns – the last 2 years.

Seek the advice of your tax agent.

You can generally only amend 2 years worth of tax returns – the last 2 years.

Seek the advice of your tax agent.

Brokers cannot provide tax advice – unless they are also tax agents or tax lawyers. but many of them do provide tax advice and get it wrong.

I’ve never seen Ed Burton’s book, but it would be way out of date now.

the best way would be to borrow the deposit under a separate split secured by any property and then borrow the remaining 80% secured against the new purchase.

Don’t use redraw

Yes it is.

You could give 2 forms of security –
1. the property
2. a term deposit

e.g.
$100,000 purchase price with $5,000 duty and costs = $105,000 needed.
Place $25,000 in a term deposit and borrow $25,000 against this
Borrow $80,000 secured against the property

But this will be a bit painful for the banks to implement.

What about the…[Read more]

Hi Gavin

This quote seems to be from material is copyright – do you have authority to post it?

This is standard asset protection stuff. The gift and borrow back strategy has been around a while and some lawyer even tried to patent in years ago – but failed.

But,
Creditors can still attack these schemes under both state law and commonwealth law…[Read more]

I should also point out land tax varies from state to state – sounds like Stoksey is talking about VIC. Land tax is worse for trusts in NSW, but better for trusts in QLD.

I just had a client sell the former main residence to a fixed unit trust. They borrowed to buy the units in the trust and can claim the interest. The borrowed money will then be used to pay off the new main residence debt.
ATO allowed this under a private ruling application. No CGT payable, but stamp duty was payable in full – however they will…[Read more]

Hi Jon

Re the LOC – some lenders allow their IO loans to be used like LOCs. The main issue I see is people borrowing money, parking it in a savings account and then investing. This will render the interest non deductible or partially deductible because once the borrowed money hits the savings account and mixes with cash once you use the money you…[Read more]

If you want asset protection from creditors then there is only one solution – a trust. That is a discretionary trust or a SMSF.
But the strength of the asset protection will depend on the terms of the trust and the structure of the trust.

You could also buy assets in the name of someone else – but this is really a trust like relationship which…[Read more]

In that case it would be similar to John in my example above

I don’t understand what you mean.

Example

John has a loan of $80,000 secured by an investment property with plenty of equity. The loan relates to the purchase of that investment property.

John now needs $20,000 for an urgent kidney transplant.

John increases his loan to $100,000.
Going forward 80% of the interest should be deductible.
This is…[Read more]

The interest would not be deductible.
You would be borrowing to pay a private expense – doesn’t matter how many detours you take.