Investment Property Ownership Options
| Ownership Option |
Asset Protection Issues |
Tax and Other Issues |
| Individuals Name |
Equity at risk of claim by creditor |
50% CGT discount. No separate structure required |
| Joint Names |
Half of equity claim by creditor |
50% CGT discount. No separate structure required |
| Sole or Joint Names funded by loan from discretionary trusts |
Family discretionary trust is only an unsecured creditor and has no property claim |
50% CGT discount. Separate structure required |
| Sole or Joint names with registered mortgage to family discretionary trust |
Family discretionary trust is a secured creditor and has a priority claim on property |
50% CGT discount. Separate structure required and a relatively low amount of stamp duty is payable on mortgage |
| Ownership by children or extended family |
Problem if family dispute unfolds |
May create family and pension eligibility complications |
| Family company |
Asset protection depends on choice of shareholders |
No CGT discount available Ability to keep income in structure taxed at 30% |
| Family discretionary trust (with company trustee) |
Very good asset protection qualities. Careful attention should be paid to the balances of beneficiary loan accounts |
50% CGT discount. Small business concessions. Separate structure required. Income allocated to company beneficiary taxed at 30% (care is needed for choice of shareholders) |
| Superannuation Fund & Self managed super fund (SMSF) |
Very good asset protection up to complying pension reasonable benefits limits |
Relatively low tax rates during both accumulation and pension phases. Benefits preserved. |
If you have any questions regarding investment property ownership call Australian Property Investor now on 03 9568 1553 or email us for a FREE, No Obligation appointment.
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