Hello,
A bit of background first.
I've got a Hybrid Discretionary Trust that I started at the beginning of this FY. I also have a Company, which is about a year old because I'm self employed. When I created the Trust, I put myself as the Trustee because my Company is less then two years old and I heard that banks don't like to deal with Companies that are less then two years old.
Since starting up the trust, I've bought one slightly -ve geared IP by buying units in the property. This means that although the Trust owns the property, I am on the actual title of the property.
I know that it is better to have the Company as the Trustee from the asset protection point of view. My plan is to make the Company the trustee, but I don't fully understand the implications on the current property in the Trust.
I was wondering if anyone has been in the same situation and what they have done.
In particular, here are the major questions that I have:
1) If currently I'm on the Title of the IP because I'm the trustee, what happens to the title when the trustee changes to a company? Do I have to amend the Title?
2) Does changing the Trustee cause a Tax event to occur? What I mean is: Will I have to pay Stamp Duty again? Will I have to pay CGT?
3) What are the implications when Borrowing money and the Company trustee is less then 2 yrs old?
4) How do people usually borrow money then the Company is the Trustee? (eg No Doc loans etc)
5) I heard that a Trust has a life of 80 years. I've also heard somewhere that this is only true if the Trustee is a person and that if the Trustee is a Company, then the life of a trust does not expire. Is this true?
Sorry about posting tough questions again, but I guess in life you always have to learn and then you die.
Anyway, I'm sure others might be interested in some of the questions too. If you are, let us know.
Thanks in Advance.
Kind regards,
Orion
A bit of background first.
I've got a Hybrid Discretionary Trust that I started at the beginning of this FY. I also have a Company, which is about a year old because I'm self employed. When I created the Trust, I put myself as the Trustee because my Company is less then two years old and I heard that banks don't like to deal with Companies that are less then two years old.
Since starting up the trust, I've bought one slightly -ve geared IP by buying units in the property. This means that although the Trust owns the property, I am on the actual title of the property.
I know that it is better to have the Company as the Trustee from the asset protection point of view. My plan is to make the Company the trustee, but I don't fully understand the implications on the current property in the Trust.
I was wondering if anyone has been in the same situation and what they have done.
In particular, here are the major questions that I have:
1) If currently I'm on the Title of the IP because I'm the trustee, what happens to the title when the trustee changes to a company? Do I have to amend the Title?
2) Does changing the Trustee cause a Tax event to occur? What I mean is: Will I have to pay Stamp Duty again? Will I have to pay CGT?
3) What are the implications when Borrowing money and the Company trustee is less then 2 yrs old?
4) How do people usually borrow money then the Company is the Trustee? (eg No Doc loans etc)
5) I heard that a Trust has a life of 80 years. I've also heard somewhere that this is only true if the Trustee is a person and that if the Trustee is a Company, then the life of a trust does not expire. Is this true?
Sorry about posting tough questions again, but I guess in life you always have to learn and then you die.
Anyway, I'm sure others might be interested in some of the questions too. If you are, let us know.
Thanks in Advance.
Kind regards,
Orion