Investing (shares) in a trust or spouse

Discussion in 'Accounting & Tax' started by Bran, 5th Apr, 2016.

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  1. Bran

    Bran Well-Known Member

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    I'm just trying to get my head around some issues

    If you invest in a trust, or your non-income earning spouse starts buying shares, then is the money transferred into their respective accounts considered income?

    I saw an option for a commsec account in a trust today - can I simply set this up and buy shares? The money would come directly from my personal account, but I would have no reasonable means to pay money into this trust via this route except to invest.

    How to get around this?


    (PS, I will ask my accountant when I get a daylight hour).
     
    Bran, 5th Apr, 2016
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  2. Paul@PAS

    Paul@PAS Tax, Accounting + SMSF + All things Property Tax Business Plus Member

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    You dont normally invest in a trust unless its a fixed unit trust.
     
    Paul@PAS, 5th Apr, 2016
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  3. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    You mean if the trustee of a trust invests...The trustee has to get the money to invest first. Someone, possibly you, would either lend the trust money or gift it/settle it upon trust. Whichever you do make sure it is properly documented.

    Same with a spouse.

    If you are borrowing the money that will end up in the trust then the interest will only be deductible to you if the money is loaned at a higher (or maybe the same) rate that you are paying and there is a commercial loan agreement in writing.
     
    Terry_w, 5th Apr, 2016
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  4. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    Terry_w, 5th Apr, 2016
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  5. teetotal

    teetotal Well-Known Member

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    Looking at the topic heading, i was going to suggest that you invest in a good spouse ;)
     
    teetotal, 5th Apr, 2016
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  6. Bran

    Bran Well-Known Member

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    Ok, let's forget the trust.

    How does my wife buy shares with no income? Can we just transfer cash from our joint account to her investment account?
     
    Bran, 6th Apr, 2016
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  7. Chilliblue

    Chilliblue Well-Known Member

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    Yes
     
    Chilliblue, 6th Apr, 2016
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  8. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    If your not borrowing simply open a comsec account in her name and have her buy the shares.
     
    Terry_w, 6th Apr, 2016
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  9. Paul@PAS

    Paul@PAS Tax, Accounting + SMSF + All things Property Tax Business Plus Member

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    Transfer of money between spouses etc is not income. Its just savings / cash.
     
    Paul@PAS, 6th Apr, 2016
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  10. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    And consider the estate planning aspects as well.
     
    Terry_w, 6th Apr, 2016
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