Avoid land tax in nsw

[LukeLang]

Hi,
I am just after some advice from some of you smart folk.

Currently own a property in nsw under a family trust that is getting hit with land tax bills! Roughly $6500 each year. Had the property 3 years and intending to hold forever. Is it worthwhile moving this property to another structure, and possibly incuring one off stamp duty?? If so, what is the best structure. Close to maxed out on indiviual landtax threshold.

Thanks

 

[Terry_w]

Hi,
I am just after some advice from some of you smart folk.

Currently own a property in nsw under a family trust that is getting hit with land tax bills! Roughly $6500 each year. Had the property 3 years and intending to hold forever. Is it worthwhile moving this property to another structure, and possibly incuring one off stamp duty?? If so, what is the best structure. Close to maxed out on indiviual landtax threshold.

Thanks

Depends - you tell us nothing about your situation so impossible to say. If you have reached your personal land tax threshold outside then your options are limited - you could only consider a company. a SMSF wouldn't be possible if it is residential.

Transferring will mean CGT and stamp duty legals and new loans. There might be a loss accumulated in the trust which you have to factor in too.

Other factors
asset protection
estate planning
other trust income
etc

 

[Paul@PFI]

If you have already met the thresholds for individuals then there is no probable benefit. Even if that trust could become a fixed trust (there may be a way) and access the threshold the secondary taxation of unitholders would mean no net difference unless that unitholder had a free threshold.

A SMSF gets its own threshold.
A company gets its own threshold.
Both have issues. SMSF may be prohibited from acquisition of an interest in this property. (related party, inhouse asset, prohibited etc).

There is a way without stamp duty (subject to value) but the final owner would be a company. There would be a CGT trigger however. The costs would take a few years to recoup. Hence may not be worth it.

Happy to discuss if you are interested and to determine if its workable....eg : What other assets / liabilities in the trust? Your structure etc

 

[Scott No Mates]

Working on a few assumptions, if you held it in your own name you would be up for even more land tax as you are already sailing close to the threshold.


Sell up, pay the agent and cgt then buy interstate where you haven't hit the threshold. Hmmmm that doesn't make $ & cents.