I had thought that SMSFs were treated in the same way as trusts but that may not be correct. - however I can't find a mention on the OSR website.
Trusts: What do you want to know
- Thread starter Terry_w
- Start date
I'd take it with a small grain of salt. The source is not from the horse's mouth (ie, OSR); also the information is not quite technically correct IMO. I don't think it's the total value of the properties, I think it's the total value of the land component of the properties which determine sthe threshold.
There was another link in Somersoft where a forum member claimed to have verified this with the OSR.
Yes. As Geoff has indicated, it is the (unimproved) land valuation upon which land tax is paid. Still, it can escalate as it is the cumulative land value of the owner's portfolio in one's personal name or entity (trust SMSF, etc).
If it were applied on a single holdings basis, it would certainly be a more palatable impost.
http://www.osr.nsw.gov.au/taxes/land/about
I am not sure, however I would also be careful in the event that one is a personal (non corporate) trustee of an SMSF (or trust for that matter) that the assessment doesn't include one's personal land holdings in the cumulative load.
Some of our Somersoft experts may be able to clarify.
I am not sure, however I would also be careful in the event that one is a personal (non corporate) trustee of an SMSF (or trust for that matter) that the assessment doesn't include one's personal land holdings in the cumulative load.
Some of our Somersoft experts may be able to clarify.
This is why we need your book Terry. That little bit of obscure information, which I was not aware of until I checked it out today, could save the cost of your book a few hundred times over.In NSW SMSFs get the threshold - which is now $412,000.
QLD threshold is $350 for non individuals and $600k for individuals. Also each entity has its own threshold, so in QLD the land tax alone can make it worthwhile to setup a new trust for each property. But that is assuming you don't need negative gearing. Looking forward to the book Terry.
QLD LAND TAX RATES
For non-individuals and absentees
Taxable value Rate of tax
$0–$349,999 $0
$350,000–$2,249,999 $1,450 plus 1.7 cents for each $ more than $350,000
$2,250,000–$4,999,999 $33,750 plus 1.5 cents for each $ more than $2,250,000
$5,000,000 and over $75,000 plus 2.0 cents for each $ more than $5,000,000
For individuals
Taxable value Rate of tax
$0–$599,999 $0
$600,000–$999,999 $500 plus 1 cent for each $ more than $600,000
$1,000,000–$2,999,999 $4,500 plus 1.65 cents for each $ more than $1,000,000
$3,000,000–$4,999,999 $37,500 plus 1.25 cents for each $ more than $3,000,000
$5,000,000 and over $62,500 plus 1.75 cents for each $ more than $5,000,000
QLD LAND TAX RATES
For non-individuals and absentees
Taxable value Rate of tax
$0–$349,999 $0
$350,000–$2,249,999 $1,450 plus 1.7 cents for each $ more than $350,000
$2,250,000–$4,999,999 $33,750 plus 1.5 cents for each $ more than $2,250,000
$5,000,000 and over $75,000 plus 2.0 cents for each $ more than $5,000,000
For individuals
Taxable value Rate of tax
$0–$599,999 $0
$600,000–$999,999 $500 plus 1 cent for each $ more than $600,000
$1,000,000–$2,999,999 $4,500 plus 1.65 cents for each $ more than $1,000,000
$3,000,000–$4,999,999 $37,500 plus 1.25 cents for each $ more than $3,000,000
$5,000,000 and over $62,500 plus 1.75 cents for each $ more than $5,000,000
Back on topic:
* the difference between having a person as trustee, a corporate trustee, a beneficiary as trustee, sole director of corporate trustee (being a beneficiary) etc & how this plays out for asset protection in each scenario.
* beneficiaries - what if you have no kids, adult kids etc to distribute profits? Can you still reduce your tax liability?
* can a super fund be a beneficiary? ie receive distribution @ 15% tax rate?
* if you do distribute widely, must you physically distribute (other than to remove the tax liability)?
* the difference between having a person as trustee, a corporate trustee, a beneficiary as trustee, sole director of corporate trustee (being a beneficiary) etc & how this plays out for asset protection in each scenario.
* beneficiaries - what if you have no kids, adult kids etc to distribute profits? Can you still reduce your tax liability?
* can a super fund be a beneficiary? ie receive distribution @ 15% tax rate?
* if you do distribute widely, must you physically distribute (other than to remove the tax liability)?
Will listing "any company which x has a directorship and shareholding in as a beneficiary either now or in the future" as a class of benediciary allow you to continually add new beneficiaries to the discretionary trust after settlement without being considered as a resettlement of the trust by OSR or ATO or incur a disposal for CGT purposes.
Yes, I think so. There was a case called Clarke a few years ago about the tax and resettlement side of things and this lightened things up on the tax front. Stamp duty is more tricky though but I don't see a problem.
I agree Mush, I have Trust Magic and it's last update as well as Nick Renton's book, Renton's is great as a nightcap
Can a young person (whose age would normally deem them ineligible for an investment account) open a Beneficiary Account with their parent's help?
Some queries to add..
Various scenario's and what entity would be applicable/beneficial
The Law of Trusts is continually changing, so maybe email updates
What's a Land Tax Unit Trust
When and should you, add children to your SMSF
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I would also like to know a little more about any specific-purpose trusts, eg I believe there is a trust that can be set up for people with a disability, that will not then endanger their pension?? Perhaps it is just a standard trust that is implemented in certain circumstances - not sure.
Yes, this is a special disability trust. Not a normal trust but one with one beneficiary and a lot of conditions.
