hi Intrigue

A PPOR can generally be passed to a beneficairy without tax or stamp duty under a will. It remains tax free for 2 years and then would be subject to CGT if they were to rent it out or may be exempt if it were to become their PPOR.

Not sure about the gifting a portion each year. Maybe you are referring to the centrelink rules where someone on a pension can give away a certain amount of money each year and still be able to get the full pension. If they were gifitng part of a house there would be stamp duty involved and conveyancing costs. These wouldn't make it worthwhile doing I think.

Also look at getting your relatives a testamentary trust in their will as these can have significant tax and asset protection advantages where the property will be a rental.

Chloe

try Fast http://www.fastgroup.com.au/member-benefits/additional-services.aspx

Thanks for the link. Looks good,

I don't know much about indonesia, more about thailand. That doesn't mean Indonesia is more secure. I think it is jsut as corrupt there as in Thailand.

I know that you can do a lot to prevent the nomiee seling such as mortgaging, 30 year leases, caveats, options etc. But how well these work is not known. If you read the link about you will see someone forged the guy's signature and just sold his property so nothing could have safeguarded against that.

At one stage the good friend of a high ranking police officer was renting my friends apartment in Jakarta (off the fraudulent owner). Getting her out was a delicate operation because of her connections. My mate had the key and just went in there which was very dangerous. You can get killed for things like this.

try omegapartners.com.au in Sydney

Yes, I can.

Firstly you have the rule of law. Over there the law does not have the same weight as in Australia. Bribery and fraud are rife and people can steal your land and other assets easily. I wouldn't even trust money in the bank there. Caveats have little weight, mortgage also – because people can easily forge signatures and documents etc.police are extremely corrupt. You cannot drive a car in thailand without having to pay a bribe at least once per month to a corrupt cop.

I have one friend who shacked up with an indonesian woman who brought a unit in his own name and somehow it ended up in her name. She stole it from him, then dumped him and he has been fighting for 5+ years to get it back. He has an order from the supreme court there, but still cannot get the unit out of her name. I went with him to Indonesia a few years ago to sort it out, and dealing with the bureacuracy there is extremely frustrating.

In Thailand, there is this man who had his $2mil AUD property stolen by his maid. It ended up being owned by the sister of the police chief and he cannot get it back. see these websites:
http://www.andrew-drummond.com/view-story-other.php?sid=389

http://www.andrew-drummond.com/view-story.php?sid=403

Secondly, how will you borrow to buy there? It will be very hard to get a loan to purchase there. So you will have to have cash or borrow from Australian property. Why not invest here where you will get a good return and rent a place there with the proceeds?

Thirdly you will need to speak and understand the written language where you are investing. If you can't you shouldn't invest. There are many different types of land title in Thailand and you need to be able to understand this and lease, mortgages, property law etc.

forthly, what about the political instability. In Thailand the king is 84 and frail, he will die soon and there will be a huge change in the society. Who knows what will happen.

You could use a redraw. But then you would be losing money by paying extra tax.

once you pay a loan it has to be reborrowed to get they money out again (even using a redraw is new borrowings). This means you will be borrowing to buy a private expense and the interest won't be deductible.

Getting good advice early on can save you tens of thousands of $$$$$$$

The majority of the population possibly!
 

Think of the future.

If you are paying down an investment property then you are tying up your cash. What happens when, a few years later, you want to buy a place to live in? You will have to borrow more because your cash is all in the investment property.

This means more non-deductible debt. ie higher interest on your new PPOR loan because you had to borrow more.

At the same time it also means you will be paying tax on your income from the investment property.

This has got to hurt!

The solution is to speak to a broker and use a IO loan with a 100% offset account. You will save interest and have your cash available without tax consequences.

If you are nervous, then that may be a sign. be careful of investing the the CBD