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Viewing 8 posts - 1 through 8 (of 8 total)
  • Profile photo of Time MattersTime Matters
    Member
    @time-matters
    Join Date: 2006
    Post Count: 16

    Hi to everybody,

    This is my first time for using the forum and we are new members. This is a fantastic way of networking and sharing experiences and knowledge!

    I have a question. We are about to get back into PI after a few years out of circulation. We have a Unit Trust set up with a Pty Ltd company hanging underneath. In previous times we have used the company name to purchase IP with. Is this the way to go or do we need to seek some advice or make some changes?

    Regards,

    Sue
    Time Matters

    Profile photo of catacata
    Participant
    @cata
    Join Date: 2005
    Post Count: 559

    That would depend on your investment stratagie and goals Sue.
    I presume that you intend to purchase IP’s in the company, this I would reconsider for asset protection and tax purposes.

    CATA
    Asset Protection Specialist
    [email protected]

    Profile photo of TerrywTerryw
    Participant
    @terryw
    Join Date: 2001
    Post Count: 16,213

    Better seek some good advice. Companies are generally not favoured for holding property as they do not get the 50% CGT concession. Look into Trusts.

    Terryw
    Discover Home Loans
    Parramatta
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    Profile photo of truebluetrueblue
    Member
    @trueblue
    Join Date: 2003
    Post Count: 142

    Generally a discretionary trust is much more flexible than a unit trust.

    trueblue

    Profile photo of noddiesnoddies
    Member
    @noddies
    Join Date: 2003
    Post Count: 151

    Hi Time matters[biggrin]

    I would suggest that you research this area of the site as the general topic on structures has been covered many times.
    Advice on basic structure set up is quite common.

    The following is a brief overveiw of some of the considerations that can be taken ,however I encourage you to undertake further research on your own or to seek specific proffesional advice.
    Other details such as Capital Gains Tax Issues,in species transfer of funds to a SMSF and any other issues that would apply to your particular situation are not covered in the reply.

    The usual Trust set up to deal with property is a Hybrid Trust as it can deal with negative gearing issues and can be used to allocate Income or losses in a tax effective manner to the beneficiaries of the Trust.

    A Trading Company which is limited in its liability (to the amount of shares issued )can also be chosen to be the Trustee of the Trust.

    The result is for the Trust to hold the assets with the administration and the running of the investments by the Company.

    Regards
    Bryce Inglis
    AR282821

    Investment & Implimentation manager

    [email protected]

    Replies on this site are intended as general information only, as any specific investment solutions/advice must only be given in accordance with the requirements set out in the Financial Services Reform Act 2001 and the ASIC guidelines as set out in PS146.An appropriate professional should be consulted for specific advice

    Profile photo of Time MattersTime Matters
    Member
    @time-matters
    Join Date: 2006
    Post Count: 16

    Thank you to everybody who has contributed with some advice.

    Regards

    Sue
    Time Matters[thumbsupanim]

    Profile photo of drollingsdrollings
    Member
    @drollings
    Join Date: 2006
    Post Count: 1

    Just another thought, an accountant relative suggested using a trust with a company as the beneficiary. The company then pays all profits into the superannuation account of a retired person(s) and once July 1 2007 rolls around, that person will then be able to withdraw that money tax free (only tax paid is 15% contribution tax). May be a way to minimise tax liability for short term renovation/development profits.

    Check out with your own accountant first, but interested to hear anyone elses comments….

    Regards

    David

    Profile photo of noddiesnoddies
    Member
    @noddies
    Join Date: 2003
    Post Count: 151

    Hi Drollings[biggrin]

    Just another thought, an accountant relative suggested using a trust with a company as the beneficiary. The company then pays all profits into the superannuation account of a retired person(s). As a contribution?

    Or 1. with the initial establishment of the Trust and dependant on the Trust deed, the SMSF is appointed as a beneficiary with a nominal unit holding, and on retirement the realization or transfer of assets occurring in- species within the Trust.
    Or 2. you could receive an income payment from the Company ATF Trust and simply contribute it to Super.

    and once July 1 2007 rolls around, that person will then be able to withdraw that money tax free (only tax paid is 15% contribution tax).

    At this stage this has only been proposed by the Treasurer and is not yet Law

    May be a way to minimise tax liability for short term renovation/development profits.

    The SMSF would have to own the asset.

    If the money changes hands to a third party it would be defined as income to the Third party and be taxable.

    If this happens before retirement, then the transfer of money will breach the sole purpose provisions of SISA causing the ATO and ASIC to be very annoyed with you.

    Financial Advisers can only give tax related advice in conjunction with a financial plan, could you please check this with your Accountants.

    Any how this has gone off topic.

    Regards
    Bryce Inglis
    AR282821

    Investment & Implimentation manager

    [email protected]

    Replies on this site are intended as general information only, as any specific investment solutions/advice must only be given in accordance with the requirements set out in the Financial Services Reform Act 2001 and the ASIC guidelines as set out in PS146.An appropriate professional should be consulted for specific advice

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