Hi all,
I have a question regarding trusts.
Lets say I have a HDT and that trust owns 1 property worth say 200k
Lets say that 100k of the loan is in the individual trustees personal name and the other 100k is at the trust level (so there is a split loan).
The 100k at the trust level is a loan against the equity in the home of which that 100k was then invested in a cash flow investment such as the buying a selling of options contracts on the ASX.
Lets say a positive cash flow profit was generated from this.
As far as I understand,
- The trustee can claim interest payments on the 100k loan in his personal name. The rent etc flows into the trust then out of the trust into the trustees personal account to cover interest payments for the loan (there are 100 000 x $1 income units that have been issued)
- The interest payments on the 100k loan in the trust cannot be claimed
- The cash flow derived from the options trading can be distributed at the discretion of the trustee meaning that the trustee does not have to have that income distributed to himself i.e. he could distribute it to a bucket company for example? As the loan is not in that individuals name?
Have I got that right?
Any comments thoughts appreciated.
Cheers,
Panda
I have a question regarding trusts.
Lets say I have a HDT and that trust owns 1 property worth say 200k
Lets say that 100k of the loan is in the individual trustees personal name and the other 100k is at the trust level (so there is a split loan).
The 100k at the trust level is a loan against the equity in the home of which that 100k was then invested in a cash flow investment such as the buying a selling of options contracts on the ASX.
Lets say a positive cash flow profit was generated from this.
As far as I understand,
- The trustee can claim interest payments on the 100k loan in his personal name. The rent etc flows into the trust then out of the trust into the trustees personal account to cover interest payments for the loan (there are 100 000 x $1 income units that have been issued)
- The interest payments on the 100k loan in the trust cannot be claimed
- The cash flow derived from the options trading can be distributed at the discretion of the trustee meaning that the trustee does not have to have that income distributed to himself i.e. he could distribute it to a bucket company for example? As the loan is not in that individuals name?
Have I got that right?
Any comments thoughts appreciated.
Cheers,
Panda
