The most tax-effective investment vehicle outside super?

Hi,

A bit of trivia, what do you think is the most tax-effective investment vehicle outside super?
 
It all depends on the sort of income, the sort of assets etc.

Generally I would agree with Monlisa, discretionary trusts because of their great flexibility.
 
In NSW the unit trust would need to be classed as a "fixed trust" to qualify for Land Tax Threshold. Not all unit trusts are fixed.

Coasty is right though, Tax exempt Charities must be the greatest structure.

Imagine you set up your own little religious group - philosophical questions aside. You buy a nice little property, no stamp duty or land tax, you may even receive some grants. Discounts on rates, maybe no rates at all. To buy the property devotees make tax deductible donations to the body so the individuals benefit in saving tax too. You then have the property closed for use of the general public and only for members of your little group. The average person cannot claim a deduction for many things, but they can claim a deduction for donations to the body who can then provide these things to the individual. eg. Childcare.
 
Buy a farm and be a farmer. Plenty of tax deductions, no tenants to worry about, you can see it everyday and a great lifestyle.
 
perhaps not the best occupation then hey...?

Can you still live in your 'charity' house - i.e. a PPOR. I learnt about this at uni and thought it was genius to set up the 'James' religion - perhaps a cool hangout for my friends and I to practice our 'religion'. How can the ATO define religion though? A set of principles to drink beer and watch sport?
 
It could be possible for a person to live in a house owned by the tax exempt institution. Also you don't need to start a new religion such as Jamesism, you could start your own Christian church or Jewish group for example. You don't even have to have any distinguishing doctrines. Just form a trust (or other structure) and meet certain criteria.

From memory a "charity" had to meet at least 1 of 4 criteria, to be a charity. There were a few recent cases where companies were operating that legally met the criteria, but it was perhaps too far removed from the general concept of a charity. The Govt is now having a rethink and the laws will be changing soon.
 
Suggestions so far:

DT
UT
Charitable/Religious organization
Farmers

Still not what I had in mind, any other guesses...
 
By vehicle do you mean structure?

There are not many structures left except for
Company
Partnership
Individual
Joint whether joint tenants or tenants in common
 
As long as it isn't something like forestry or other tax effective schemes. Ponzi schemes in my opinion. Evidenced by the fact many of them have gone under in recent years.
 
Not forestry/Ponzi or vintage cars.

PPOR is a good one, but not what I'm thinking of.

And not a trick question.
 
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Probably a small business. Provided you meet the relevant tests the sale of the small business will be tax free. Could easily have a business you sold for $4m being tax free in your hands. Not many opportunities like that.
 
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