Family Trust Australia Explained - Pros & Cons
Vložit
- čas přidán 29. 06. 2024
- Confused about what the benefits are for a family trust? Watch and find out about family trust in Australia explained.
In this video, I talk about:
0:00 - What is a Family Trust?
0:59 - Components of a Family Trust
1:47 - The Benefits
3:49 - The Disadvantages
5:53 - Final Thoughts
It's important to make sure you speak to a good lawyer and accountant when considering if this structure is best for you!
-
Thank you for watching this video. I post weekly videos on this channel to provide the latest and most frequently asked business questions. Please take a second to say hi in the comments below. Also, if you enjoy my comments and find it valuable, subscribe to the channel, like and share it with anyone who you think might find my channel useful!
-
► Subscribe to my channel here:
/ daviemach
-
Davie has over 10 years experience in advising businesses in management accounting and taxation issues. He heads up a passionate team at Box Advisory Group who are dedicated to offering proactive and outstanding service to our clients.
Davie’s extensive experience in providing tax and consulting advice and astute business knowledge has paved the way for success for many businesses.
He is a member of the Chartered Accountants Australian and New Zealand, a member of the Australian Tax Practitioners Board and holds a Bachelor of Commerce degree from the University of New South Wales.
-
Follow Me:
LinkedIn: / davie-mach
Instagram: / boxas_syd
Facebook: / boxadvisory
Website: boxas.com.au/
-
DISCLAIMER: Please note that every effort has been made to ensure that the information provided in this video is accurate. You should note however, that the information is intended as a guide only, providing an overview of general information available to contractors and small businesses. This guide is not intended to be an exhaustive source of information and should not be seen to constitute legal or tax advice. You should, where necessary, seek your own advice for any legal or tax issues raised in your business affairs.
Very helpful dave! Keep it up ❤
Very brief yet informative. Thank you
Glad it was helpful, Zandi!
Great video, thanks for that :)
No problemo
Informative
At 1:10 you mentioned that a Settlor cannot be the Beneficiary.. However for Malaysian, as stipulated in Trust Act 1949, a settlor can indeed be the beneficiary too. Hence I bought some Cash Trust for myself.
Hi Davie, on a different topic is the a video you have on vehicle purchase under family trust as work vehicles. We are trying to get started with a franchise business under our family Trust. It requires us to have a full time work van and we want to buy it under the Trust name. What are the considerations?
Do we have to register the vehicle under the trustee name (in this case it's a company)
Are family trust included in asset tests for government pensions on retirement?
Thanks for the clip Davie. Quick question, does transferring a property you own into a trust incur CGT?
Yes it does, best to speak to an accountant.
Also be careful with land tax and family trust as well.
The beneficiaries are not paying the tax bill for me . What do I do about this ?
Hi thanks for explaining. How is the tax handled on distribution to the beneficiaries?
It’s on their marginal tax rate. So depends on how high their taxable income is. Google income tax rates for individuals and it will explain how the tax works
@5:08 Land tax free threshold: I know in WA and QLD it does apply. What about VICTORIA?
Hey Davie, if I conducted my business as a partnership, and held my personal assets in a trust, wouldn't this provide a similar protection as running a limited liability company?
Yes similar but not exactly the same. I wouldn’t advise on this because holding your home in a trust would mean you would lose out on the main residence exemptions for CGT and taxes.
Hi Davie. I really like your channel and it’s very informative. I had a family trust with corporate trustees. I plan to use family trust to buy shares. Is any pros and cons to do that? Thanks
Thank you. Sorry Cindy it’s too hard to say unless you get proper advice to review your situation. Accountants need to look into your income, assets, loans, investment intentions and family.
Thank you :)
i have a question.
say i was to win the lottery for example, how can i use a trust to protect against tax and be able to organise a monthly wage to be paid to to each beneficiary with a bank account that allows me to earn interest?
if i was to pay a wage and the interest earnt was a lot more than what was paid to each beneficiary, can the money left over be reinvested back into the earning account to enable more interest to be earnt?
Hello, firstly in Australia gambling wins are not taxable so you can just gift money to individuals tax free if it’s from the lottery.
Trust don’t pay wages so you are probably mean distribution. You can distribute the profits/income of the trust but only if the trust made money.
There is no interest charged on distributions.
You can lend money to individuals and there may be interest on the loan however we can’t advise on this as it could be financial advice.
Best you book a meeting with an accountant as the questions you have asked need a full analysis of your current situation.
@@DavieMach so if I invested into an index fund and used the interest to pay beneficiaries and not touch the principle.. is that an option?
@@garystinten9339 Yes it can be an option for your trust
In what, some, any or which respect do trusts, overall, compare or differ with, perhaps geographically distant, yet historically and politically similar jurisdictions (just comparing among the English speaking)?
Sorry, I'm only qualified to share my expertise in the Australian system.
Any video to do registration of a trust ?
Trust is complicated and you will require a lawyer or accountant to create this
Can a trust be contested by outside family members once the trustee passes away?
I gather a lot of the idea of a trust is to keep people's stucky fingers off it because the assets are no longer in your name. If the trust has you as the only trustee and beneficiary, it can be wound up and taken from you in a legal challenge such as a divorce. This is why it's better to have more than 1 trustee and beneficiary
say for example if a parent of 4 children wants to pass on the family property to split 4 ways rental income (not selling the house) after when they pass away, is it better to transfer the title to include 4 names of the children or put it in a trust?
Hard to say without proper tax advice and understanding the full situation. To answer this question it involves assets, risk level tolerance, income level of children, age, spouses, relationships, businesses and etc.
Does a family trust generally only relates to those who earn higher than the average income?
Really depends actually, if you are a high income earner by have no family in Australia then you wouldn’t benefit other than asset protection.
But if you have many family members with low income you could benefit greatly from family trust.
@@DavieMach I just saw a mail that came through the other day and it was about my dad’s family trust and I wanted to know more that is why I decided to look it up on CZcams. So per say a family like mine, mum, dad, and two other siblings one is internship, I’m still a student with a part time job and a little sister in high school, it will be more worth it than us being grown ups with a substantial income?
@@Ace-cc2wl sorry ace but it does sound right. I can’t really be certain as I don’t know the full picture.