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Use a trust to buy in NSW and QLD with land tax threshold

Discussion in 'The Buying & Selling Process' started by htopg, 23rd Jun, 2015.

  1. htopg

    htopg Well-Known Member

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    I have used up my personal land tax threshold in NSW and QLD.
    I am looking to buy more in NSW and QLD.
    Is it possible to set one trust with corporate trustee to buy properties in NSW and QLD and get land tax threshold separately?
    I know from asset protection point of view, it is better to have one trust for one property in NSW and another one trust for one property in QLD.
    Thanks in advance.
     
    Last edited: 23rd Jun, 2015
  2. RPI

    RPI Property Lawyer, Town Planner Business Member

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    Land tax is state based. So your NSW land value doesn't count towards your threshold in QLD. In QLD if you have separate trusts but with same beneficiaries and same trustee you can be aggregated.
     
  3. beachgurl

    beachgurl Well-Known Member

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    There's no land tax threshold for trusts in NSW.
     
  4. htopg

    htopg Well-Known Member

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    You are right if the trust is a "special" trust.
     
  5. htopg

    htopg Well-Known Member

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    I was not asking about whether I can add up the threshold of NSW and QLD.
    I was asking about one trust + one NSW property with NSW threshold + one QLD property with QLD threshold.
     
  6. Terry_w

    Terry_w Solicitor, Finance Broker, CTA Business Member

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    It can be a good idea to keep things separate. The stamp duty laws in QLD are tricky in relation to trusts. So a need to amend the trust could trigger stamp duty in QLD but not in NSW for example.

    But there is no threshold in NSW for trusts. The QLD threshold could be obtained though.
     
  7. htopg

    htopg Well-Known Member

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    Can I view it as that additional $1000+ per year in exchange of flexibility (amending trust in NSW without triggering QLD stamp duty) in the future?

    Aren't there fixed trusts that can have threshold in NSW?
     
  8. Terry_w

    Terry_w Solicitor, Finance Broker, CTA Business Member

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    Not sure what you mean here?

    Not really. With fixed trusts the unit holders are considered the owners for land tax purposes. If the owners of the units are individuals with no other NSW property (other than main residence perhaps) then they may be entitled to the threshold.
     
  9. htopg

    htopg Well-Known Member

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    I assume that one trust will cost $1000/year to maintain.
    Scenario 1:
    One trust to buy one NSW property and one QLD property.
    $1000/year
    Amending trust will trigger QLD stamp duty

    Proposal 2:
    One trust to buy one NSW property
    One trust to buy one QLD property
    $2000/year
    Amending trust for NSW will not trigger QLD stamp duty
     
  10. htopg

    htopg Well-Known Member

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    Many accountants to whom I talked said that it is doable.
    They proposed trust with corporate trustee and the trust will get its own land tax threshold.
    Is it true?
     
  11. Terry_w

    Terry_w Solicitor, Finance Broker, CTA Business Member

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    Yes, in that case you could think of it as extra flexibility, but also extra asset protection if the trustee is sued (e.g by a tenant) and estate planning reasons.

    And, amending a trust may not trigger duty in QLD, but changing roles can.
     
  12. Terry_w

    Terry_w Solicitor, Finance Broker, CTA Business Member

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    No.