It takes a while for this info to sink in.

Broadly speaking there are two ways to own property – for yourself and on behalf of someone else.

The best example is children's bank accounts. If a mum opens an account for the 2 yr old child she is owning the property (ie the money). Whose money is it? It is in the mums name but the kid is the true owner. This would be an example of a bare trust.

So the trustee is the legal owner, but the trustee only owns the property for the beneficiaries of the trust – these are the beneficial owners of the property. This is why if a trustee is sued the property of the trust is, generally, out of reach.

The role of the trustee is more than administrative – they are the legal owners and can do with the property as per their agreement with the beneficiaries.

There are also 2 aspects of asset protection.

The first is if a trustee is sued as an individual. eg you are trustee of your property trust and are sued because of defamation related to your personal issues. The property that you own as trustee for others is not able to be taken from you to fulfill any judgment – generally, there are many exceptions.

The second is if the trust itself is sued. the trust is not a legal entity, so it is the trustee that is sued. In this case the trustee may be liable for the judgment but is generally indemnified from the trust assets. But, if the trust does not have enough assets to satisfy the judgment then the trustee's other assets will be at risk. This is why you should use a company for anything in which there is a risk of being sued – such as owning real property or a business. If you just own shares there is no real risk of the trust being sued as shareholders are not liable for anything the company does.

Using a company as trustee also has other advantages such as:
– helps to clearly distinguish personal assets from trust assets.
– easy to change control of the trust. You just change directors. If you are a personal trustee you would have to change title deeds and loans etc
– easy to add people
etc

This won't help – actually not selling will help, but not the buying CF+ bit

You need a decent broker, but may also need tax advice.

eg. If you are planning on moving out and renting that place you may want advice on using the LOC to pay the loan and costs on the current PPOR while building up cash reserves in a offset account.

LOC = Line of credit.

They generally have slightly higer rates but not always. You may also be able to use a normal IO loan too – ideally one with free redraw.

You could have foreign beneficiaries. Nothing wrong with that, Just consider the tax consequence as non residents pay higher taxes.

The overseas trust could loan or gift to Australian trust. No real tax consequences on gifts. If a loan and you want to pay interest there will be tax issues. The trustee may have to withhold tax or the interest may not be claimable if you control the overseas trust and the ATO considers it your money – especially if the trust is located in a tax haven.

Yes, the house and adjacent land up to 2 hectares would be exempt. So perhaps try to estimate the value of that and the value of the whole property and then work more acrurately what the CG will be. From there you can plan your strategy.

I will speak to my accountant tomorrow about another matter and mention it to him.

When do you think your parents will be selling?

The laws around international tax are complex, and I haven't looked into them in any detail.

My understanding is that the ATO wants to tax you on your worldwide income, so they ask and want to know your world wide income. Using a company to hold your assets overseas may mean this is still required to be reported – I think there is a question about this on the ATO tax return.

Whether you have to pay tax or not, and where will depend on the situation. There is a double taxation agreement between USA and Australia so you shouldn't be taxed twice. And what tax you pay will also depend on what the income is, if any – eg is it a dividend from the company, wages, partnership income etc. All these may be taxed at different rates.

Also, leaving the money overseas shouldn't affect whether you pay tax on it here or not.

Do a search on the ATO site and you will find something.

What is the security for the loan?

hi Lisa

You need to get expert advice on this considering the sums. Use someone good.

I am not sure there is much you could do, but there may be something involving small business concessions or farming relating.

If you property has more than 1 title you may be able to sell in separate tax years too. Or you may be able to sell to a trust now, one that you control, at a lower transfer amount and then the trust sell to developers later on – stamp duty etc now may be less than the tax later.

Mum would pay CGT on the profit on her half of the house. You can pay under market rents but this will limit her ability to claim deductions.