Company vs Trust Structure EXPLAINED SIMPLY (Australia)

[@ronlucock3702]

Hey mate, great video. I started as a trainee accountant for a swanky firm with swanky clients when I was 20 years old in 1988. It was a golden era. And yes, we had lots of high-income clients who were distributing income to 6-month old babies. But one technical check: You said that back then you could give $18,000 to a child under 18. I assume you said $18k because that's roughly the Tax-Free Threshhold NOW. Back in 1988 it was $5,400. So whilst we were encouraging clients to distribute their income, we were also encouring them to have more kids. They could literally be a day old on 30 June. They didn't even need TFN's. But we could only give them $5400. But anyway, that's history. Your guidelines for the here & now were spot-on. Liked & subscribed. 😃

[@DavieMach]

@@ronlucock3702 yeah you are right! The tax free threshold was lower back then. Damn, 1988 was before I was born!

[@ronlucock3702]

@@DavieMach 1988 was before a LOT of things were born - the internet (as we know it), mobile phones (that weren't as big & heavy as house bricks), & "portable computers" were literally the size of suit cases! And yet they were the best days of my life! Keep up the good work mate.

[@DavieMach]

@@ronlucock3702 damn I missed out then 😅 I thought the early 2000s were sick. Thanks mate appreciate it

[@huzlfinance]

This is brilliant Davie. So well explained. Big fan of your offerings.

[@Riccardo_123]

Another great vid 🎉 thanks for taking the time Davie!

[@DavieMach]

@@Riccardo_123 thanks mate I really appreciate you watching

[@chrisdavey3113]

Great video mate. Nice and easy to understand for non accountants. You need to up your fees though 😂 I quite often recommend the hybrid structure also but sometimes with a holdco between opco and holding trust. Mainly so that the retained earnings can be paid in franked divs to opco to be used for other investment purposes without the requirement to distribute taxes somewhere (like bucket company to minimise div 7a BS 😂)

[@emmama5841]

Hi Davie, my question is 8:22 disadvantage of a trust- NO CGT discount? I think this is 50% discount if hold the asset more than 12 months. correct me if needed.

[@DavieMach]

@@emmama5841 yes that’s wrong shouldn’t be a disadvantage and yes there is a cgt discount!

[@markd152]

I’m 52 hoping to end the rat race by 60 with above $1M. I know money is a liability to be exchanged for assets with real value like real estate (properties for rent) stocks (dividends) bonds (interest) But, what is it with bitcoin? I hear a lot about it and I'd love to diversify my portfolio.

[@StephanieMoore-oj7vz]

bitcoin does not pay any yield but will reward you with growth that you can't find in any other asset class

[@DavidMartins-y1c]

look at the charts, bitcoin has outperformed every stock and banking product ever developed even after multiple pullbacks over the last decade. not a financial advisor but I know what i'm saying

[@jeffbox1torres]

The key to financial stability is having the right investment suggestions for a diverse portfolio. Many investment failures and losses happen when you invest without proper guidance.

[@NianLisa]

Finding yourself a good broker is as same as finding a good wife, which you go less stress, you get just enough with so much little effort at things

[@DannielleRosales]

I went from no money to lnvest with to busting my A** off on Uber eats for four months to raise about $20k to start trading with Evelyn Infurna. I am at $128k right now and LOVING that you have to bring this up here

[@neilhay2155]

thank you, very helpful and informative.

[@jalihumunguy6309]

Well made video, good presentation. Subscribed

[@JoshFrancis-d6i]

Mate that was very good and informative

[@yiannimav]

You mentioned trusts get CGT discount but at 08:20 you said that they don’t. Which is it? Also, what’s the deal with negative gearing, can you benefit from it in a trust? Do banks only lend to a trust if it’s positively geared (ie meeting its obligations)?

[@Nerdificationing]

How do you move a property into a trust - do you have to repay stamp dury?

[@DavieMach]

@@Nerdificationing yes if you are selling your property that you own. There will be stamp duty. That’s why it’s best to get proper advice before you make the decision

[@davianoinglesias5030]

This is why I pay for WI-FI, new subscriber

[@davhong]

Great content, I have a question based on the hybrid diagram - would an individual pay tax twice? Firstly via the business and secondly when the dividends are distributed as income?

[@DavieMach]

@@davhong you get a franking credit which is similar to tax withholding in your gross wages. The ato gives you a tax credit on the dividends you receive on your company’s profit. That way you don’t get double taxed

[@praveenv629]

well explained Davie

[@thafrost5]

Can you do some videos or more videos on how to pay less tax with loop holes or grey areas that millionaires and billionaires in Australia use, And examples with drawings or graphs that explain it Like when people get in the 10m-10b kinda money range and how to reduce it or pay no tax or as minimal as possible Especially if you have assets like crypto or anything that has capital gains basically that you can reduce beside the 50% 12 month hold discount other ways to reduce would be interesting to see how the elites and top guys do it

[@DavieMach]

its on the cards - thanks for the suggestion :)

[@MrBruster78]

Well done, best explanation.. not even my accountant could do this 😂

[@DavieMach]

@@MrBruster78 haha most accountants have bad communication skills

[@MrBruster78]

@@DavieMachtell me about almost 3 weeks to hear back from him for a simple question 😆

[@DavieMach]

@@MrBruster78 lol 5 days mate and I never said I had good communication skills hahahaha

[@Rolls87]

Wouldn't your example on hybrid structure be better to pay tax inside company at 25% as. Opposed to going through the trust since the beneficiary rates are higher??

[@DavieMach]

@@Rolls87 yes if you prefer the money in the company. But what if you need the money in your personal name or your family’s income is low, this method gives you the flexibility to do both when the situation gets better.

[@cherylsenia8696]

Thanks for sharing

[@rob-neill-aus]

Now what if yur revenue in the company is all PSI - personal services income - ATO requires company profits to be reduced by declaring Directors fees (taxed at personal tax rate) to stop leaving a big profit int he company and paying the lower company tax rate... Is a discretionary trust therefore beneficial for this type of revenue (PSI revenue).?

[@DavieMach]

@@rob-neill-aus hard to say when PSI is a problem. Depends on the each situation and what your goals are with the profits. Best to get some paid tax advice from an accountant.

[@AhsanAli-ib4uz]

Bro you said if you are a sole trader then you can offset your personal income. I made 8k from uber last year and I had a loss of 17k so I had to deffer the loss as the taxable income as sole trader was less than 20k. I earned 90k from my full time job last year. I did not get any offset. Please answer

[@DavieMach]

@@AhsanAli-ib4uz you need to pass the non commercial losses to be able to claim it. If you meet the income requirement and pass any one or more of the four tests, you can offset your business losses against your other income in the relevant year. The four tests are: assessable income test profits test real property test other assets test

[@TrangLe-ef2tr]

👍thanks

[@sarasabery89]

So... are you saying, if someone, let's say a builder has a family trust, and they did such a horrible job at building that the building collapse did to their dodgy work, and if they are sued for damages/ losses and if they show their have no money in their account, then you can't go after their assets because they simply have a trust? Makes no sense. If that's the case wouldn't most people get a family trust, be as dodgy as they can be and rest assured that no one can go after their properties because they have a family. Surely there must be a way to go after their assets if they are found guilty?

[@DavieMach]

No I am not saying that. Structuring helps give you a layer of protection. I am no lawyer so I cant comment on the specifics of how it works.

[@Amy-u1e]

I'm favoured, $22K every week! I can now give back to the locals in my community and also support God's work and the church. God bless America.

[@DriftLibrary]

I learned something

[@DriftLibrary]

I learned I need to find an accountant

[@relaxationchannel6667]

hey Davie, is it possible to run a company in Australia that's owned by a trust overseas in a non-tax country and not pay any tax ?

[@chrisdavey3113]

The Australian company will still pay Australian tax and require an Australian resident director.

[@Musteringdownunder]

Trust no one

[@emersondeguzman9686]

No

[@CineTechGeek]

Discretionary trusts should be made illegal. I have been exposed to discretionary trusts numerous times. Each time it is because a member of the discussionary trust has done things to his own competitive advantage at the expense of another company and because he is in a discretionary trust there is no way to remedy the situation because he doesn't own the shirt on his back. There is no way to suit the individual . And as ASIC has shown to do nothing to these people these con men can get away with everything and never get caught or punished.

[@AlphaConviction]

Running a company / trust in communist Australia is foolish. (Fulltime daytrader here that has my structure offshore)

[@SamanthaBrookeYT]

Hallelujah!!! I’m blessed and favored with $60,000 every week! Now I can afford anything and support the work of God and the church. For Your glory, LORD! HALLELUJAH!

[@RobertAnthony___zz]

Oh really? Tell me more! Always interested in hearing stories of successes.

[@SamanthaBrookeYT]

This is what Melissa Jonas Richard does, she has changed my life.

[@SamanthaBrookeYT]

After raising up to 60k trading with her, I bought a new house and car here in the US and also paid for my son’s (Oscar) surgery. Glory to God.shalom.

[@MichaelJames346]

I know Melissa Jonas Richard, and I have also had success...

[@MichaelJames346]

Absolutely! I have heard stories of people who started with little or no knowledge but managed to emerge victorious thanks to Melissa Jonas Richard.