Trust vs LTC for residential investment property – which is better?
Well, it depends if the property is negatively or positively geared, i.e., does it make a loss or a profit.Read More
9 times out of 10 an LTC is the best structure for owning a rental property: “You have the benefit of limited liability, a legal structure that is clearly a separate entity yet under your control, and yet it is treated at tax time like a partnership: the best of both worlds.”‘Read More
Note that you can’t offset any losses against income from other sources e.g. wages, like you used to in the good old days. That is what the concept of “ring-fencing of losses” means. The losses are “ring-fenced” so that they only apply to residential rental property.Read More
Let’s say that the company owes the shareholders $150,000. This is tracked in the Shareholders Current Account, and is a liability (debt) of the LTC…Read More
That’s a good question. What is a Look Through Company or LTC? Basically, it’s the replacement for the old LAQC (Loss Attributing Qualifying Company). At tax time, you look through the company to the shareholders, and distribute the income (or losses) to them. How is it different from a normal company then?A “normal” limited liability company can pay dividends…Read More
You obviously want to know: What’s the best way to structure our mortgages? For 5 tips: scroll down. But let’s assume you have Your own home, with a mortgage A rental property, with a mortgage What do you want to achieve? In order of priority: Pay off the family home Ummm, I haven’t thought much…Read More
How a trust might become a sham: A trust that starts off as genuine and legitimate – the trustees are all involved in decision-making – might become a sham if one trustee in effect hijacks the rest. What do we mean?Read More