Monday, 6 June 2011

Watch out QLD property Owners RULE CHANGE

Last post I talked about Land Tax in QLD - find your land tax update by going here:

source: AFA


If you are considering new property in Queensland or currently hold property in a trust structure in Queensland you should contact our office and arrange for your structure to be reviewed.

In essence, Land Tax was previously levied at the Trust level on property with an unimproved land value exceeding $350,000. From 30th June this financial year it will be levied at the Trustee Level, which means if the trustee controls multiple trusts with unimproved property values combined which exceed the $350,000 threshold, land tax will now be levied on the Trustee.

Practical example:
In simple terms, a single Corporate Trustee of two trusts each owns property with unimproved values of $200,000ea. With combined unimproved values of $400,000, the trustee in this example would incur a Land Tax bill each year of $2,300 at the current rate of tax.

Land Tax is applied on a sliding scale as your combined Queensland property value increases.
More details on Rates of Land Tax and implications are available on the web at:
http://www.osr.qld.gov.au/land-tax/
<http://www.osr.qld.gov.au/land-tax/>        or by contacting our office.

We still strongly believe Trusts are an effective way to hold property for many investors, and this remains the case. The benefits of asset protection, taxation effectiveness, and ability to distribute income with flexibility, all remain.

These changes to the land tax rules have altered the structure requirements slightly, but we still have a cost effective solution. We will provide a quote for any changes to your files before we undertake any modifications if required.

To reduce the likely implications now or in the future, we would recommend a change to structures should the unimproved combined value of land in Queensland property exceed $300,000.

Please do not hesitate to contact our office directly on 07 5439 1655

www.activefa.com <http://www.completebusiness.com.au>  

Active Financial Answers (AFA)


p.s - thanks Tony and Irene