I’m still in the learning phase of investing in property. Reading Steve McKnight’s 0-130 properties book, it seems that investing in multiple properties would require complicated trusts. While I would never invest as heavily as he does, would you honestly need all that if you were buying say 5 – 10 well chosen CF+ properties?
I too would be keen to hear peoples view on this matter
I would not purchase 5-10 properties in my own personal name for a number of reasons.
Setting up a Discretionary Family Trust is a fairly inexpensive and painless exercise and if the properties are +cash flow then gives you a multitude of options when it comes to income distribution.
Course you might want to bolt on a Company Trustee which costs a few extra dollars but small fry in regards to the endless savings.
I use a series of 5 separate DFT's for our porfolio but that is not say that is right. Just my level of comfort.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
You can buy as many as you like in your own name.
You don't NEED to do anything. Just find out the pro's and con's of different structures and decide how you want to proceed.
Using trusts won't help you own any more properties and it could all be done in your personal name – but I think that would not be a good idea for a number of reasons.
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
I know there’s the asset protection reasons, tax reasons (which I’m still trying to understand!). I did hear the the Federal Government will be introducing tax laws that will target trusts now.
You may have heard something about changes to taxation of trusts, but this is just to clarrify a few aspects with nothing in the pipeline that is adverse – that I know of.
Another reason is the flexibility in passing on control in your life time and after you are dead. If you did have a child and wanted them to take over, you would just hand control of the appointor role and make them director of the trustee. No stamp duty.
On death trust assets dont form part of your estate (except some limited exceptions in NSW) and so are safe if your will is challenged.
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
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