Very messy.

If one party stops paying the other joint borrowers will have to take up the slack or they could lose the lot.

Either joint owner could apply to the Supreme Court to appoint a trustee to take over and sell and split the proceeds. This is likely to cost $20k plus if all goes smoothly.

Good summary by Catalyst – let this be lesson for the people out there.

1. They rent will be taxable as per normal
2. You move on. Changing ownership would be costly.
3. depends
4. nil for a trust. ASIC fee for a company $243 per year.

Not true.

In that case both properties could be exempt if you sell the existing one within 6 months of acquiring the new one – seek tax advice as you need to plan.

It is possible to avoid CGT totally yet still claim all interest if planned carefully

renov8r wrote:

There has to be a loopol in the system somewhere.. This Can’t be impossible ! Surely someone has done it before.??

Lenders won’t be keen on these loans even if you had a job – short term soon to discharge. Brokers will not be keen as they have to give any commission back to the lender.

All you need is a stable income source – and dreams about income from flipping don’t count, need strong evidence of success

Just because you ‘subcontract’ doesn’t necessarily meaan you are a conntractor. There are various tests to pass from a superannuation POV and a tax point of view. There are also the legal side of things — you will need your own insurance for starters.

I’ve just set up a trust for someone with a child where he donated sperm and he doesn’t appear on the child’s birth certificate. He wanted the child to be a beneficiary and we did that by naming the child and also changed the definition of child to include artifically made children. This avoids confusion as there is legislation which means children created by donating sperm are generally not conisdered children of the donor.

further Benny’s comment, there are 4 broad classes of discretionary trusts. One with a closed class – so all beneficiaries are in existance and another with an open class which means future people can be beneficiaries – those to marry into the family and those to be born into a family. Also companies and trust later established can be beneficiaries

One strategy is to marry a vendor just to avoid stamp duty by becoming a beneficiary of their trust.

I am not sure what happens in practice. I am not an accountant and have never seen a beneficiary receive income of more than $416 pa.

In what circumstances would this arise?

Yes, you should get a private ruling.
What is the purpose of you capitalising interest this way? Only for a tax benefit in the future.