NSW has 5 days cooling off period too – although this can be waived. If the purchaser pulls out during the cooling off they forfeit 0.25% of the purchase price under the standard contract.

Be very careful about redrawing money. Get some tax advice first, but generally you could use the money as deposits on the next property – $8000 is no enough at this stage though.

And don't be tempted to increase this by paying the loan down, it would be more effective to borrow the equity.

That book is not correct on this topic.

And, I think you understanding of what was in the book is not correct either. He was not talking about multiple directors, but multiple trusts.

Income of a guarantor will be used to assess the borrowing capacity. This includes all loans the guarantor has in their personal capacity and as guarantor. So setting up a new company or trust won't effect this as the other loans guaranteed will still affect the new loan applied for.

You can increase borrowing capacity by having 2 directors of a trustee but you probably shouldn't for 2 reasons:

1. asset protection

2. Affect on future borrowings

Different states have different rules and they are not very clear. It could be possible in some instances but best method is to avoid the risk of double stamp duy and contract in the relevant entity from the start.

What you have signed could be a contract – whether labelled contract or no.

Seek legal advice asap as you may have a few grounds to termination such as cooling off period and other.

Safest way would be to pay market value and transfer title.

Based on what you have said about it would probably not be worth doing for a few reasons:

1. Stamp duty on the onsale to the trust

2. Less asset protection because you are transferring

3. Your top tax rate is 32.5% whereas  a company would be 30%

4. Good idea not to have the trustee as a beneficiary for stamp duty reasons, in NSW at least.

5. When selling it would be be best to get the gain in your own hands rather than a company as individuals pay only at max of 45% tax, less the 50% CGT discount = 22.5% plus medicate levy. If you distribute to a company 30% with no 50% discount.

If one property in one name it could have enabled you to split the capital gain between the both of you, but I think it would be too late to implement now.

And just because the valuation has come in short doesn't mean you can get out with the finance clause either. Has the finance been rejected?

You can't break the law just to get $20k.

Look up the FHOG Act and you will see the definition of "spouse" – which may be in another act such as the Acts Interpretation Act. Then see if you meet the definition. If you are not living together in a domestic relationship then you will probably not be spouses and would probably still qualify.

If the trust makes a taxable income after expenses then tax will be payable. Who pays depends on the terms of the deed and when the beneficiaries become 'presently entitled' to the income. This can occur before they actually receive the income. “Presently entitled” basically. means a right to demand immediate payment of the income.

If no one is presently entitled then usually the trustee would be taxed, or maybe default beneficiaries depending on the deed.