Transferring properties to a discretionary trust

Hi all,

In the past 4 years, I have purchased 4 properties in QLD under my personal name. At the time of acquisition, I have paid stamp duty based on the contract price. Over the time, I learnt that serviceability decreases from this set up and that it also doesn't provide me asset protection as a Trust.

Therefore, I am looking to transfer these 4 properties into a discretionary/family trust (with a corporate trustee that I am the director of) that I have already set up.

Can anyone advise of their similar experiences and whether this has triggered for stamp duty for the transfer? I am not concerned on CGT because I don't believe there's any gains in the current market.

Thanks

 

This would be a dutiable transaction.

Seek legal advice as there are many other issues

 

And a cgt event. It may reduce the costbase but add fresh duty. Existing tax losses need to be considered. Legal costs. Trust costs...and refinance

 

Thanks all. I have checked with the conveyancer in QLD to have confirmed the same thing.

 

May be worth moving the highly positively geared properties into the trust.

need to project the tax savings and how many years to offset the stamp duty cost.

 

It could be done as part of debt recycling strategy as well. But the costs are generally high and many issues to consider.

 

Hi

Can someone let me know whether transferring a property in nsw from my individual name into a unit trust (corporate trustee (that im a director of) & myself as a beneficiary) will incur stamp duty when changing title? As the unit trust’s ultimate beneficiary is me, I am unsure whether stamp duty is involved.

thanks

 

Have you sought specific advice on land tax in each state?

A conveyancer can't provide legal advice IIRC

 

Yes generally

 

This is for NSW. I have considered land tax but as an investor, it is better to have asset protection & stronger serviceability. So ideally, IP should be purchased by trusts rather than individual name - for my circumstances.

 

Terry, is there a way around this so I don't pay stamp duty again if I am the ultimate beneficiary of a unit trust anyway? thanks

 

How does a unit trust with units owned by you provide asset protection?

 

It doesn't.

 

Well the strategy is to fix a property I already own in my name without deteriorating the serviceability, so basically sending it into a unit trust. Then sell it when the time is right, which is the next financial year. Then the issue with asset protection wouldn't matter for this property. Because all my other properties are in discretionary trusts now, except PPOR. I also have another unit trust, to invest with 2 friends. Trustee is a corporation and the unit holders are 3 x discretionary trusts. So that would not have asset protection? We have 3 properties in this unit trust now.

 

some think there are - ways around the duty

 

It does.

If the trust is sued it is the trustee that will be hit - $2 limited liability
But if the unit holder becomes bankrupt the units are available to creditors.