and expenses are better recorded , and many expenses are tax deductible . The effective tax rate paid in a well-structured property portfolio is much lower due to lower tax rates in the correct entities and the conduit principle in some instances .
Asset Protection
Trusts protect our assets if something happens to us financially or when we die . It houses the wealth we build up and offers better protection than when it ’ s in our name . Without a trust , you cannot protect what you have built up .
Don ’ t hold any assets in your name . It ’ s the worst place to keep assets as you usually sign surety for any debt acquired in any other entity . Personal liability can expose all the assets in your name .
This is why you MUST have at least a Holdings Trust to hold the shares of your property company ( and other companies ). You should also ideally have a separate Family
Trust to hold personal assets and through which you can manage your loan accounts to all your other entities .
P . S . You always donate the maximum to the Family Trust and lend what you can to it , and then the Family Trust lends to all your other entities . Your Family Trust becomes the lender to all your other entities .
Estate Planning
There are many costs related to death , including estate duties , capital gains taxes , executors ’ and transfer fees . They can wipe out a large portion of your wealth before your family sees it . The only way to protect against this is through trusts .
Start taking advantage of the benefits of correct trust structuring today and watch your portfolio soar ! \\\\\\\
SA Real Estate Investor Magazine OCT 2022 145