Unit Types for HDTs
- Thread starter Nominees
- Start date
Nominees,
When you have bought the property for the HDT, essentially you have borrowed money, & then you have bought units in the unit trust where the property is held.
Ordinary units are then issued by the unit trust (equal to the property price plus costs)to the HDT, & income units (equal to the loan amount)are issued by the HDT to the borrower.
The borrower is the income unit holder & is entitled to a proportion of that income, since you borrowed the money to fund the purchase for the trust.
Regards cheffong
When you have bought the property for the HDT, essentially you have borrowed money, & then you have bought units in the unit trust where the property is held.
Ordinary units are then issued by the unit trust (equal to the property price plus costs)to the HDT, & income units (equal to the loan amount)are issued by the HDT to the borrower.
The borrower is the income unit holder & is entitled to a proportion of that income, since you borrowed the money to fund the purchase for the trust.
Regards cheffong
Hi Nom
Your trust deed will define the units properly and explain what each is and how they work. In general though, you will use a unit that allows you to have a right to the income of the trust and this is very important as this right is what allows the individual to claim the interest on the loan as a tax deduction.
Dale
Your trust deed will define the units properly and explain what each is and how they work. In general though, you will use a unit that allows you to have a right to the income of the trust and this is very important as this right is what allows the individual to claim the interest on the loan as a tax deduction.
Dale
