JD86Member@jd86Join Date: 2009Post Count: 52
I have recently the chapter in steves new book about family trusts. how they are used as asset protection and how you can borrow more because you are guarantor for the loans for the trust so you can borrow more
this sounds great, and is an avenue id like to pursue
however, i am building a house and the mortgage is in my name, eventually this house will be an IP but for a year or so will be my PPOR
so i wont be able to guarantor much because of my high personal debt
can i transfer my PPOR (soon to be IP) into a trusts name?
also, how do i go about setting up a family trust? speak to my accountant i imagine? anyone know what costs are involved?
i have just recently read about trusts so if any aspects iv said are wrong please correct me
thanksDan42Member@dan42Join Date: 2008Post Count: 620
Transfering from your name to a family trust may trigger stamp duty.
Talk to your accountant about setting up a family trust, and the costs will be somewhere from $250 to $500, depending on their margins!miikeParticipant@miikeJoin Date: 2008Post Count: 111
An accountant can help you discuss the movement of the property as per ATO regulations, however a lawyer is the appropriate person to speak to regarding asset protection.
Ensure the structure matches your aim, be it asset protection or reduction of tax.
MiikeJD86Member@jd86Join Date: 2009Post Count: 52
so to transfer to a trust would definately incur stamp duty? anyone know a way around this?
is there various types of trusts? anyone have any suggestions on what the best are?
i have been informed that it may be mortgage fraud to have numerous trusts and not inform the back that i am guarantor of other trusts
is this correct?
thanks guysmiikeParticipant@miikeJoin Date: 2008Post Count: 111
There are plenty of different structures available.
Either way, when you transfer land/property from the name of a person into another company or person. You are affectively changing ownership of the title, thus stamp duty will apply.
Please seek further information from a licensed professional that specializes in this. http://www.chan-naylor.com.au may be a good place to start.
MichaelPI101Member@pi101Join Date: 2009Post Count: 9
From what I understand from my Solicitor – Trusts can be set up in so many ways – with very specific rules that suit you – but at the end of the day the ATo rules apply – so yes I believe that you will be up for Stamp duty. You really need to speak to someone who sets them up for property protection for a living – set it up wrong and it might cost you a lot. Good LuckTerrywParticipant@terrywJoin Date: 2001Post Count: 16,110
There are stamp duty exemptions for transfering from trusts to individuals – but not sure of the other way around. And they wouldn't apply in most situations relevant to investments. eg trust set up to own property for a minor and then the property transferred to the individual when they reach 18.
PI the recent case of Bamford has shown that trust deeds overrule the ATO when determining what is income so they don't always win, though they are appealing this in the High Court so they may still win. And the stamp duty is not a administered by the ATO, but by each state through the Office of State REvenue (in NSW).mpjtMember@mpjtJoin Date: 2009Post Count: 7
I too am thinking about converting my PPOR to an IP and buying a new PPOR via some sort of family trust. Could anyone
advise me on someone that they know of in the ACT that does this sort of thing, either an accountant or mortgage broker or
both?. I am a novice when it when it comes to this side of finance and need someone that i can trust.
MickTerrywParticipant@terrywJoin Date: 2001Post Count: 16,110
You should get some tax advice on trusts before you make the decision. The mortgage broker can advise on the loan side of things but not tax. You really should look at the legal side too – but it all costs. There are many things to consider such as state revenue issues such as land tax, income tax, CGT, legal responsbilites, corporations law, trust law and loan issues.
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