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It seems to me that the issues being raised with HDTs relate to negative gearing via issued units, and then only if the possibility exists for the unit holder to avoid capital gains (or if there are discretionary distributions while units are issued). So if you only want the benefits of a DT by...

Another question is can the courts force the trustee, who would not be the bankrupt by that time, to either redeem the units or sell the associated asset? GP

Actually this introduces another issue: if the unitholder is entitled to CG, then that must impose some restrictions on unit redemption. If the trustee can always redeem the units at face value, then effectively the unitholder has no guarantee of receiving CG, as the trustee could redeem the...

It doesn't say that. What it says is: If capital gains are not distributed to the unitholder - or rather, if the unitholder has no right to capital gains - then this would likely be the case where the income return is less than the loan interest. If capital gains are also distributed to the...

I fail to see how discretionary distribution of capital gains implies a private purpose of asset protection. What do capital gains have to do with asset protection? Their argument of no obvious commercial explanation is more logical though. GP