It all comes down to deposits. If you keep coming up with the deposits, you can keep getting loans. That’s the hard part!

Terryw
Discover Home Loans
North Sydney
[email protected]

Thank you Kaloni.

The draft ruling is TR 2004/D3 and is available from:
http://law.ato.gov.au/pdf/tr04-d03.pdf

Terryw
Discover Home Loans
North Sydney
[email protected]

http://www.businesslawyer.com.au

Terryw
Discover Home Loans
North Sydney
[email protected]

Hi Cajun

When you say linked, do you mean the company is the trustee, or just a beneficiary?

1
It is usually the Trustee as Trustee for the trust.
eg the company X Pty Ltd as trustee for (ATF) the Smith Family Trust.

2
Rent would be payable to the trustee or the trust.

3
If you live in it, you would pay rent to the owner – the trustee of the trust.

4
The trust can claim deductions for interest etc, but you cannot offset this against your perosnal income (unless a hybrid trust). So unless the trust has other income, it will probably run at a loss. This loss is not transferable, and can only be used to offset future income.

BTW, I am not an accountant and don’t know what I am talking about!

Have you purchased the book, “Trust magic” yet?

Terryw
Discover Home Loans
North Sydney
[email protected]

The cashbond strategy invloves buying an annuity to give yourself extra income to increase your borrowing capacity.

Terryw
Discover Home Loans
North Sydney
[email protected]

Just talk to your solicitor and tell him you are going to offer vendor finance by lending the deposit to the purchaser. The solicitor can draw up the neccessary paperwork such as second mortgage.

Terryw
Discover Home Loans
North Sydney
[email protected]

I think Dale was worried that if you were buying and selling lots of properties quickly, as happens with wraps, then the ATO could class you as a trader and the properties as trading stock, and you would therefore lose the 50% CGT discount. For this reason, I think, he recommended you keep the buy and holds in a different structure – as you definitly don’t want to lose the CGT discount on these.

Terryw
Discover Home Loans
North Sydney
[email protected]

Interesting.

often the ATO only imposes a 5% penalty for making voluntary disclosures. If they catch you making a false return, then it is around 70% and they can prosecute.

If is possible that the could issue assessments based on the figure declared in the low doc declaration (where it is higher than on the tax return). It would then be up to the tax payer to prove that they did not actually earn this amount.

But, I think the ATO is probably just trying to scare people into paying more tax. The can’t really issue a blanket assessment like this – it is really like a fishing expedition!

Terryw
Discover Home Loans
North Sydney
[email protected]

G7

These days you need to become an AMC (accredited mortgage broker). see http://www.miaa.com.au for more info. I think you will need to do a course unless you have two years relevant experience (eg working in a bank etc). Once you are an AMC, you can then get accredited with the individual banks.

You can join an existing company, buy a franchise or start your own business. It would be better to work for an existing company for a while to make sure it is the right job for you and to gain some experience. It is a great job for investors as you gain knowledge of how to structure deals to stretch your borrowing capacity further, and you get so see what everyone else is buying.

Feel free to contact me with any specific questions you have.

Terryw
Discover Home Loans
North Sydney
[email protected]