Have a look at the latest http://www.bantacs.com.au newsletter – which has something on this – and check out their other pdf documents.

If the valuation indicated there is structural damage, many lenders will not lend or may require a engineer's report on the stability of the building.

At 21sqm it would be very hard to get finance for. This may not matter if you are paying cash from existing equity, but when you sell it will limit the number of potential buyers and hence the price!

Depending on what sort of work the higher income earner is doing, he/she may be able to structure all or part of the work as a contractor and divert money into the trust that way. Careful planning is needed though as there are various rules to meet before this is allowed. Investment income is no problem but the shares/properties would need to be…[Read more]

You will need to have a good read of the contract the vendor has entered into with the broker and your contract with the broker. There is probably a clause in there which states that any person introduced by the broker, no matter when or how long ago, will mean commission is payable.

Whether a HDT or a UT can allow the unit holder to claim interest or not will depend on the wording of the deed. it has to be worded in such a way that any income or capital gain must go to the unit holder. Who would borrow to buy units if there was no surety of getting an income someday. Not sure of the commercial benefit for someone to buy units…[Read more]

A trust is where someone holds something for someone else. The easiest way to understand the concept is to think of a parent opening a kids bank account. The parent is the legal owner, but the beneficial owner is the kid – the parent (the trustee) just operates the account for the real owner (the kid as beneficiary).

Yes, if you are intending to rent them out you can claim the usual expenses such as rates, insurance, interest etc.

There is a way to divert profits into a trust for existing properties and that is for the trust to rent them from you at a lower rent, in exchange for various commercial reasons, and then the trust can sublease the properties at a higher rate. You have to be careful to do everything at a commercially realistic rate though.

I would make a complaint to the CBA complaints section. I;ve had many problems with them in the past, but when I pulled all of my loans out of there are few years ago it went smoothly!

Hi Again MCI think you can do what you describe, but are ok as long as everything is done at market rents. A trustee has a fiduciary duty to the other beneficiaries of the trust so you cannot rip them off by charging yourself a lower rent and the ATO would be concerned about this too. But if everything is above board at market rates it should be…[Read more]

M.C.It will be hard for you to borrow in your names if you don't own the property. Not many lenders are willing to do this. st George may be one that is ok with it.I am not sure how this will help tax deductions though. Initially the trust will be running at a loss unless you find a healthy positive geared property. Even then the trust will have…[Read more]

$300 per hour is pretty standard rates for an accounting firm, but usually they have a set price to set up a trust which includes some advice and the deed and the ABNs and TFNs. it could end up costing you are lot more paying by the hour.

It would probably be best to set up a trust initially and see how it goes, then you may want to change things a bit – eg you may want one trust each so it will be easier to go your separate ways down the track, if need be. It may also assist in serviceability if you have one each, as you can keep the guarantee to one of you. Just do every second…[Read more]

you should definitely set up before signing contracts or stamp duty will apply when you change over.It is very easy to set up a company and trust yourself, but maybe easy to stuff things up too so it may be wise to get some advice. e.g. putting a spouse as settlor of the trust would mean they could never be a beneficiary. One of my clients put his…[Read more]

StumpCam wrote:
Hi Terry, I'm just going off what my accountant has told me:"I have tested the Tax Office on quite a few cases and they seem to be happywith no need for having to move away etc to get the 6 year rule. With thelarge property value increases in recent times I am always cautious as tohow they will try and attack CGT, but they seem…[Read more]

HiI am not  exactly sure what you are saying, but basically you can borrow up to 80% of the value of the security without incurring LMI.so if your property was valued at $600,000, then max loan without LMI would be $480,000.Maybe the figures given by the bank are a bit out as they have calculated the 95% loan and then added the LMI on top of this figure.

You would just borrow the money from your LOC and lend to your company. You make an income from the interest, but the interest you are charged would offset this and the company is left with the deduction. You couldn't claim a deduction if you were gifting the money to the company nor if you were lending at a lower rate than you were being…[Read more]

You would want to minimise the number of guarantees as much as possible. I think structuring it through a discretionary trust with a company as trustee may be a good idea. it is easy to add or remove directors without having to sell or transfer title and you can limit the number of guarantees by limiting the directors. One down side is possibly…[Read more]

I would have thought it the value of the land at the time of sub division. check out http://www.bantacs.com.au and get a few more opinions as the ATO is often wrong.I think if you had purchased prior to about 1985 there is no CGT as it only applies for property purchased after its introductions