Help Please ,Property in wrong name

[elbony8]

Help!
My situation is as follows;
My PPOR is in my wife’s and self’s name as joint tenant’s .Value $750,000 mortgage $300,000.
I’m in business for myself (company structure with self as Director, wife has no involvement or ownership of company) and I am becoming increasely concerned about ligation and been sued. As such it’s sensible to get the family home property out of my name.

As I understand it I have two options:
I can transfer my share to my wife and pay $12,000 to OSR, (ouch!) or transfer entire ownership to family trust and pay a huge $29,000 to OSR (ouch!!)
Does anyone in forum world have a suggestion?
Thanks for reading!

 

[wbthom]

Hi Elbony8,

Have a read of these posts for some suggestions.

http://www.somersoft.com/forums/showthread.php?t=14125&highlight=asset+protection

http://www.somersoft.com/forums/showthread.php?t=18860&highlight=cross+securitization

 

[skater]

Check with your accountant, but it is my understanding that you can transfer property to your wifes name without having to pay stamp duty at all. If it is to go to a member of your immediate family you can tranfer it somehow through love & devotion. Not sure how it works, but do some research.

 

[Monopoly]

Elbony8,

Go to your OSR website, search under the term "Natural Love and Affection" in relation to transfer of titles, and you will find that this is permissable between SPOUSES ONLY. It does not apply to any other family member. Do check thoroughly as legislation MAY vary from state to state, however, assuming it is acceptable in your state, you would be exempt from paying any stamp duty for the transfer of title to your wife's name.

Cheers,

Jo

 

[Jamie]

Hi,

In both NSW and QLD the 'love and affection" exemption is only permissable if the transfer of property results in both partners having an equal share in the property after the transfer - that is, you can use it to put someone on the title, but not to take somebody off. This therefore will not be applicable in your situation.

You can read the legislation here

Sorry I couldn't be more helpful

Jamie.

 

[elbony8]

Thanks all for your assistance ;
As the property is in NSW ,looks as thou I have to pay the duty , or leave myself exposed - a rock and a hard place ! what a rip off !
Steve

 

[bicko]

Hi Steve
What line of business are you in?

Maybe you should look at changing directors of your company to your wife
Then create a family trust as the sole share holder.

Have a look into options along these tracks

 

[wbthom]

Steve,

The main risk is you being a director of an at risk company - if the company is sued then you (as the director) have some risk of being personally liable and hence risking your PPOR. There are two positive actions you can take to asset protect yourself without changing the title on your PPOR.

1. Roll your business over into a trust with a company as trustee (can be done fairly easily). You, as the director of the trustee company, control the business but don't actually own it. Unless something happens directly inside the business, then the business assets are less at risk.

2. Protect your house by cross securitisation or 2nd mortgage strategies (refer my earlier post for the links to posts on these strategies) to make it look that you are so much in personal debt that you become an unpalatable litigation target.

I would not transfer your PPOR to a trust as not only would the stamp duty hurt but you lose any capital gains and land tax exemptions that apply in your state.

Whatever tactic you take needs to be done early as anti-avoidance ATO clawback rules mean that in most cases you are not fully asset protected for up to 30 months after you change. It's like insurance, you need to have an asset protection structure in place long before a threat exists.

 

[elbony8]

Thanks to all for your imput, Bill I will bounce those ideas off my accountant .
Steve