Further to NickM's post on the InvestEd forum....
Last year; we had the tax office ask for a lot of information on the HDT that we use in relation to about a dozen clients.
We provided all the usual information and the tax office went away for a little while and then came back and asked to see copies of minutes; unit certificates and trust deeds. These were duly provided and the tax office thanked us for our co-operation and did nothing more.
This year, we again received an enquiry (yes, just one out of the 400 plus trusts that we lodge) from the tax office and we duly answered with all the information requested and noted that the ATO had conducted a review of the HDT structure last year with no action. We noted the name and contact details of the fellow involved.
The respnse from the tax office was quick and to the point......"we have no problem with the HDT, we just need to make sure that the interest was incurred, can we please have a copy of the bank loan statement?"
The refund cheque was released 2 days later with no further action necessary.
Of course, there is more information available on the HDT. But, this clearly demonstartes to those people who refuse to listen that the ATO ahve no major problem with the structure when a good trust deed is used and the laws are applied properly.