M: Based on this, i do not see any point in buying in the name of a company in my situation. Do you agree?

T: There can be some reasons to buy in the company name. One is land tax. But this would depend on where you are buying

M: I have read somewhere that in this scenario if one trust incurred losses from one property…. then this can offset the gain of the other two IP-trusts structure, consequently evening the gains across the investing structure and therefore producing a more effective distribution across the beneficiaries. Is this right?

T: One trust could distribute to another trust, depending on the trust deed and some legal issues. So a trust with a loss could receive a distribution from the trust with the income.

You may also be able to set your business up with a separate trust so profits from the business could be distributed to the trust with the loss.

M: if my IP1 produce positive cash flow, then this money should be move to an offset 100% account.

T: If you are talking about cashflow from the property then this is best put into a 100% offset account attached to the PPOR loan as this interest is not deductible. This is just income so there are no tax consequences. If you are talking about withdrawing equity (ie borrowing) then you should never deposit this money into a savings account.

M: What is involve in the process of re-using the money distributed to the beneficiaries  back into further investments?

T: Distributions to beneficiaries means the money belongs to them. They could use that money to pay down non deductible debt or lend it back to the trust or gift it back to the trust. There are various legal and tax consequences involved and things should be considered carefully.

If a distribution hasn't been handed over to the beneficiary then this is called an Unpaid Present Entitlement. The money belongs to the beneficiary and it is treated as a loan by the beneficiary to the trust. There are various legal issues here such as what happens if the beneficiary demands repayment and the trust hasn't got liquid assets to make the repayment? This can often happen on death and can lead to the estate suing the trust (seen if happen with one of my clients).

Hi

Here is my take

1. Ideally you should borrow 100% of the new property in case it is ever rented out in the future. To do you you would get the 90% LVR loan and set up a separate split on the existing one for the remainder. Once you have settled on the new PPOR move all of your cash from the other offset to the offset on this one. Have the loan IO and just keep plugging money into the offset.

2. I wouldn't be afraid. If rates are rising that would probably mean the economy is heating up and rents could be rising faster than usual. Rates are probably going to just in 0.25% increases so it will take a long time before they hit 7%. The interest on this will be deductible too so this lessens the pain. And if you are worried you could consider fixing a portion of the loan.

Not sure why your accountant set up a trust before you intend to use it. What sort of trust and did you get advice on the land tax implications?

3. You could set up another split on the existing loan and then borrow to pay for investment related expenses and use this to keep spare cash in the offset.

Many ways you could do something like this. some are:

1. approach the owners of the property

2. Find someone to invest with you

3. Find a builder – you arrange a profit split

4. find someone to lend you money

5. you lend someone money and they buy it

6. Use a unit trust to invest.

etc

Wow 12 months have passed and it seems like much longer.

I opened my firm, FinLaw Pty Ltd, in March 2013. I never did open my own financial planning firm, but have an in house financial planner sitting in my office and work closely with him. I can also advise on tax and credit matters.

One of my other goals was to lose some weight, but I think I have put some on.

Do you mean there is one title for the whole block?

If so the owner will not be able to sell this unit separately. They would be to be strata titled.

Think if it this way, if you were to go bankrupt the banks would take the property securing your debt to them. Any other assets would be up for grabs. But if you don't own anything and have little equity then there will be nothing for creditors to take – this could discourage them from suing you in the first place.

I was a mortgage broker for several years and then started studying law and became a lawyer. It was a lot of work and took about 5 years but now I wish I had done it sooner. Given your tax background you may even get some exemptions too – and you can still give similar advice to what you are doing now, but get paid double! So why not become a lawyer? A tax lawyer?

I am also a mortgage broker still – I gave it up for a while, but got back in because it is easy work and it ties in with the legal advice. I've qualified as a financial planner and decided not to get licenced myself but have a licenced adviser in my office. This seems to be the most difficult of law, tax and mortgage broking. It is  a lot of work and hard to find people willing to pay the fees which justify the work. There is a lot of compliance work involved.

INCOME TAX ASSESSMENT ACT 1997 – SECT 118.145

Absences

             (1)  If a * dwelling that was your main residence ceases to be your main residence, you may choose to continue to treat it as your main residence.

             (2)  If you use the part of the * dwelling that was your main residence for the * purpose of producing assessable income, the maximum period that you can treat it as your main residence under this section while you use it for that purpose is 6 years. You are entitled to another maximum period of 6 years each time the dwelling again becomes and ceases to be your main residence.

             (3)  If you do not use the * dwelling for that purpose, you can treat it as your main residence under this section indefinitely.

          (3A)  This section does not apply if the * dwelling was your main residence because of section 118-147 and ceases to be your main residence because of subsections 118-147(3) and (4).

             (4)  If you make the choice, you cannot treat any other * dwelling as your main residence while you apply this section, except if section 118-140 (about changing main residences) applies.

Example:    You live in a house for 3 years. You are posted overseas for 5 years and you rent it out during your absence. On your return you move back into it for 2 years. You are then posted overseas again for 4 years (again renting it out), at the end of which you sell the house.

                   You have not treated any other dwelling as your main residence during your absences.

                   You may choose to continue to treat the house as your main residence during both absences because each absence is less than 6 years.

                   You can make this choice when preparing your income tax return for the income year in which you sold the house.

Only 1 would be exempt from CGT per couple.

Many courses I am afraid – Bachelor of law, Grad Dip legal practice, Master of law, dip financial planning, etc

And hundreds of short courses.