hybrid trust advise

[bubbleroo]

Hi All,

I am 'still' in the process of setting up my hybrid discretionary trust (hdt) and feel that it's still not what it is supposed to be.

The story is i got my accountant to set up a hdt for me & he refers me to a solicitor of his choice....'not the cheapest but do a good job', so he recommends. However, my dilemma is that after so many amendments i still feel that it's more a hybrid unit trust then a hdt.

Firstly, i am named as the first unitholder & the primary beneficiary & as first unitholder provide the trust with the 'settlement sum'
Secondly, there is no mention of the 'settlor'

From chris batten home page, under hdt advise, the settlor should not be a beneficiary...so who's right ? my solicitor or chris ?

When i questioned about the settlor on my trust my solicitor confirm that the first unitholder is the settlor of my trust.

It was quoted to cost me $1100 to set up a hdt but now it's close to $2000 & i don't want to abolish this one & set up one with chris batten but i do want to get my trust right from the start.

Please Help
Bubble

 

[NickM]

Hi Bubble

It may still be a HDT as i generally set them up with a nominal amount of units.

If it is a Hybrdi Unit trust I daresay that would not be the preferred vehicle for property investment.

However, it concerns me that your accountant had to refer you to a solicitor.

I use Chris Battens deeds and his deeds specify that the settlor cannot be a beneficiary. You will need to check the clauses in your deed.

i would probably go back to your accountant with a letter for him to sign assuring you that

1. it is a Hybrid Discretionary trust
2. you will be able to negative gear through the trust if used correctly.

Apart from that it is difficult to say too much more without looking at your deed.

NickM