1. No. Costs can only be deducted to the extent that the relate to generating an income.
Some costs could be claimed against capital gains when sold though.

2. Only one could be counted as the main residence at any one period.

3. Yes would pay tax on the rent.

Bank's don't usually revalue or call in residential property loans.

Sounds like you are doing things the risky way. There are ways to do it much more safer for you.

As long as the borrowed money was used for an income producing asset then you should be fine – (assuming it was directly used).

The property wasn't income producing then but may be now so the interest would be deductiblle – probably

And for a solicitor, google "Bob Balanda" he is on the gold coast somewhere I think. I think he had written some articles on getting out of a contract too.

The trustee will be sued and the trustee personally liable. If you are trustee you and your assets are at risk.

Substituting trustees now won't help because the old trustee entered the contract.

Whether they can come after other trusts the answer is yes they can, but it will depend on how it was all set up and transacted. If you go bankruptcy then the trustee in bankruptcy cannot, on the face of it, take assets which you hold on trust for others. But there are lots of exceptions. Since you are the trustee of this trust too there may be a dispute whether you hold these properties in your own right or as trustee.

Your best bet in getting out of the contract is to go thru it with a fine tooth comb and make sure they have given everything or included everything that they are legally required to in the contracts.

If you have a strong stomach you could read this recent QLD case about a purchaser who didn't settle:
South Sky Investments Pty Ltd v Luppi  [2012] QSC 27
http://jade.barnet.com.au/Jade.html#sy=261412

And it may not be acceptable to the other 2 as the director is the one that controls the company. But worth considering.

You can change settlement dates if they agree. If the contract is conditional then you may not be in so much strife. Best to work out a new settlement date before it goes unconditonal as you will have more leverage over them.

This will depend on  a lot of factors.

Probably a fixed unit trust with a company as trustee. There should be only 1 director – why have more than 1 when not needed, it just creates extra risk.

Each person can have their nits held by a discretionary trust if they choose.

You must consider a whole load of things before setting this up though. The most important being finance – if you cannot get a loan in the structure then there is no point.

You should have special conditions in the contract and then do a final inspection before settlement.

If you already own the land then you won't be paying GST. But when selling new property you would have to charge the purchaser GST if you sell within 5 years. There may be ways around this.

You should seek the advice of a tax person.

A development company may need to be a registered builder too. You should look into the licencing requirements.