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http://www.somersoft.com/forums/showthread.php?t=33828&highlight=richstar http://www.somersoft.com/forums/showthread.php?t=27289&highlight=richstar

You might have to add "wants to negative gear" to that Sailor. Otherwise a discretionary trust will do the job for asset protection (plus it's been tested in the courts).

Wouldn't a principal and interest loan reduce the asset protection because the loan is being paid off, thus building equity which would be available to creditors?

This quote seems to sum things up pretty well.

Hi Shadow I haven't seen the PIT deed. But I'd be interested to know how having a longer vestation period than 80 years gets around the 'rule of perpetuities'. Thanks Ben

Shadow Mry was refering to the application of the units. Not what the deed says about the units. The deed should allow for right to capital on the units, but the application for the units will not. If the application did, you have lost your asset protection and may as well have gone with a...

Hi GSJ The other thing to remember is, as I understand (someone can correct me) that the loan used to purchase the units in the trust is secured against the property. From what I understand, the loan is not secured against the value of the units. So, the ATO will look at the commerciality...

James and all Perhaps the units could be valued at cost times CPI because that's all someone would be willing to pay for them. ie. The Trustee can redeem the units at no lesser value than the consideration paid for them, so why would anyone else pay more than that? On the other hand, the...

Hi James and all Perhaps you or someone else could verify the following for me. 1) If the units are valued at cost times CPI, what is stopping the ATO from ruling the arrangement as one of private nature in order to receive asset protection? Or ruling that the arrangement is between related...