Reply: 1.1.1.1.1.2.2
From: Anony Mouse
On 12/19/01 3:14:09 PM, Brett Burt wrote:
>I am using a unit trust to do
>a development. It is a =very
>simple structure. Many use a
>unit trust hanging off a
>private super =fund, as
>super funds cannot borrow, to
>do this.
>
>Trust members money will
>probably stay in trust for =a
>few
>years and they opt out as when
>they wish, on completion of
>the project =to take a
>profit with their original
>stake (50 to 100K). They then
>obviously pay =tax on
>this, but being clever
>......well that it is a
>different story. =
>
>The Trust can use the capital,
>profits from first =small
>development and the tax that
>would have been paid by a
>natural person or =company
>to buy another DA
>approved block, borrow
>construction cost and away
>=you go
>again.
>
>If you have a group of friends
>wanting to make =better than
>average returns with fairly
>low risk the trust is they way
>to =go.
>
>BB
Brett,
Be careful about hanging unit trusts from a SMSF.
Here is an excerpt from ATO site:
, regulations were passed on 29 June 2000 to allow an SMSF to invest in a unit trust or a company without that investment being considered an in-house asset if certain conditions are met. The main conditions are:
The trust or company:
does not borrow;
has no assets that have a charge over them;
does not invest in or loan money to individuals or other entities (other than deposits with authorised deposit-taking institutions);
has not acquired an asset from a related party of the superannuation fund (after 11 August 1999) other than business real property;
does not acquire an asset (apart from business real property acquired at market value) that had been owned by a related party of the superannuation fund in the previous three years (not including any period of ownership prior to 11 August 1999);
does not directly or indirectly lease assets to related parties, other than business real property;
does not conduct a business; and
conducts all transactions on an arm's length basis.
http://www.ato.gov.au/content.asp?doc=/content/Professionals/super/24322063.htm&page=5
"A government that robs Peter to pay Paul can always count on the support of Paul."
Of course, Paul's support is obvious, but it is equally obvious that to rob from Peter to pay Paul will make Peter
very, very angry.
My question is this: "How can you run a good government with a sore Peter?"