First time poster....so please go easy!! A few years ago we (wife and I) made the decision of buying our IP's through an HDT (Hybrid Discretionary Trust). It sounded like magic at the time but we've since learned it wasn't too smart a move. Anyway we have what we have and are learning to put up with the consequences of our poor judgement. At present the properties are marginally negatively geared. As they start to be positively geared we were wondering : 1) Do the income units HAVE to be redeemed? 2) When units are redeemed what is the process? Do we simply re-finance the loan with the trust now becoming the new borrower of the funds? I assume the trust accounts will also have to be amended. If so how is this shown in the financial reports? Will this be shown as a liability in the balance sheet as technically the income units are bought back by the trust but the trust has no cash? A third question but probably not related to the first two. One of the trust properties can be subdivided into 3 strata titles. If we build and retain properties on each lot, does this trigger a capital gains event? If so what are the consequences? My apologies if my questions are vague but I am hoping someone on here with a legal / accounting background will clear my confusion and shed some light.