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Family Trust: Shares & CGT

Discussion in 'Investing Strategies' started by Strawbs, 29th Aug, 2012.

  1. Strawbs

    Strawbs Member

    Joined:
    27th Aug, 2012
    Posts:
    10
    Location:
    Melbourne
    Hi,

    We operate my small'ish ICT Contracting business under a Family Trust structure; I am fortunate to get a variety of work and therefore meet the 80/20 rules. I am now looking at purchasing some shares within the Trust structure and wanted to confirm the treatment of CGT.

    Are the Shares (as Assets) held on the books as "Shares AT Cost" in the Non-Current Asset section with CGT calculated when they are sold (not for many years I hope) or do these need to be put at "Market Price" at the end of each financial year meaning CGT is paid on an annual basis?

    Thanks.
     
  2. Terryw

    Terryw Well-Known Member

    Joined:
    9th Jun, 2006
    Posts:
    653
    Location:
    Sydney
    I am not sure of the accounting treatment but would suggest you not hold shares in the trust you operate your business from, for asset protection reasons.
     
  3. jrc77

    jrc77 Well-Known Member

    Joined:
    26th May, 2008
    Posts:
    147
    I'm in similar position - run IT consulting business through a discretionary trust. I have a separate trust for holding shares.

    One main reason for this is asset protection. If something happens in my business I want to keep my investments isolated from it.

    Regards,

    Jason