House swap

Discussion in 'Investment Strategy' started by Timbo1234, 1st Feb, 2019.

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  1. Timbo1234

    Timbo1234 New Member

    Joined:
    23rd Jul, 2017
    Posts:
    3
    Location:
    Melbourne
    hi all,
    Just thinking that we have a 4 bedroom house under a company name between myself and brother with 440k owing and I have a 3 bed house I live in which still has a 200k mortgage which I can claim nothing on.
    I am thinking if I can buy the 4 bedroom house and make it my primary place of residence from company and let the company buy my existing house(both about same price 700 - 800 k and develop this land with 2 house (900 sq block).
    Besides the stamp duty is this possible and how do I come up with a price to buy and sell to reduce stamp duty for both IE can I buy and sell at $600,000?
    I hope you understand
    Thx Tim
     
  2. Propertunity

    Propertunity Exclusive Real Estate Buyers Agent Business Member

    Joined:
    19th Jun, 2015
    Posts:
    2,812
    Location:
    NSW
    Your company will incur a CGT liability on any sale of its house to you (or anyone else) if there has been a CG since your company purchased it. There is no CGT discount for properties held for 12+ months by a company, that you get when held in personal names.

    Stamp duty is to be calculated at market values not some lowball arbitrary number you come up with to reduce transaction costs. It would be best to get a valuation from a registered valuer or take an average of say 3 x market appraisals from real estate agents in the local area.

    You need to seek professional accounting advice before doing anything, especially when doing developments.
     
  3. Stoffo

    Stoffo Well-Known Member

    Joined:
    14th Jul, 2016
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    1,228
    Location:
    Sydney
    Sounds like an exercise in donating stamps to Govco coffers :confused:
    Maybe you would be better off doing all you can to improve your ppor and sell it.
    Then find another project (assuming you have the funds to develop the company site).

    @Terry_w will have some advice in his tax tips (if you do a search)
     
  4. Terry_w

    Terry_w Mortgage broker licenced 4 tax/legal advice Business Member

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    18th Jun, 2015
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    Remote
    Yes it's possible.
    Duty would apply at market value as would CGT. New loans needed.

    Might be a slim chance to argue a trust exists and avoid duty and or CGT.