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Property Invetors with partners - Do you setup a company ?

Discussion in 'Legal Issues' started by OzTEXS76, 1st Jul, 2015.

  1. OzTEXS76

    OzTEXS76 New Member

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    howdy all,

    iam looking at buying properties in conjunction with my brother who's got some cash left over from his recent divorce.

    we are looking at going 50/50 in properties across Australia.

    what do you guy recommend as far as the setup is concerned ? ie setup a company / trust or just a partnership with ABN etc ? what do you guys who have partners do ?

    Cheers
     
  2. Terry_w

    Terry_w Solicitor, Finance Broker, CTA Business Member

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    too many variables, no right answer.

    A company is one way to do it, but no 50% CGT discount. others include
    - fixed unit trust.
    - a partnership.
    - 2 separate discretionary trusts as Tenants in common.
    - a SMSF
    - one your name, one his name
     
  3. Arnel

    Arnel Well-Known Member

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    As @Terry_w said.

    I've done it with a mate, each had a trust operated under one pty ltd.
     
  4. Terry_w

    Terry_w Solicitor, Finance Broker, CTA Business Member

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    Do you mean each trust was shareholder of the trading company?
     
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  5. Arnel

    Arnel Well-Known Member

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    Yep 50:50
     
  6. Meisterin

    Meisterin Member

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    Me and my brother buy under his name as he has better serviceability.

    I know this has many potential issues but we get around it by having our parents as middleman to sort the issue out: ie they will adjust their will should something happen.

    Also i have a loan agreement drawn out and signed by him which gives me the right to register a mortgage or caveat should something happen. I've never had to register it though.

    I sold my share of our first property 3 years ago and we just bought our second property together. He will either buy me out or we will sell the property in 5-10 years time.

    i think this partnership works because we both invest with spare money which we don't need and can live without and we can actually talk to each other re tax, depreciation etc and come to agreement easily.

    i wanted to put my name on title as well but it limits serviceability when I am buying with my husband.

    We also have the option of buying in a unit trust or company but don't want to do bookwork just for one property but may consider it if we agree to buy more property in the future.
     
    Terry_w likes this.