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off market transfer

Discussion in 'Accounting, Tax & Legal' started by Jen, 2nd Feb, 2007.

  1. Jen

    Jen Member

    Joined:
    21st Oct, 2005
    Posts:
    23
    I'm not sure if this post should be in shares or accounting as it relates to both.
    My 11 yo daughter has enough money to invest in shares and I want to buy her some Argo shares. I personally use e-trade for shares and was wondering how it goes accounting- wise if I bought these shares through e-trade and then did an off-market transfer. I haven't ever done this before and was wondering how I account for it if the shares are originally bought through our trust (which the e-trade account is under). She would deposit the money in the trust's account and then our trust would buy the shares and finally transfer them back out to her.
    The other thing I was unsure about is if I transfer the shares to her, do I put the shares into my name ATF daughter?

    I don't feel I've written that as clearly as I could but if anyone can give me some advice I'd appreciate it (on the issue, not the way it's written!:) )
    Cheers,
    Jen
     
  2. Simon Hampel

    Simon Hampel Co-founder Staff Member

    Joined:
    9th Jun, 2005
    Posts:
    4,623
    Location:
    Sydney, Australia
    Have you considered simply holding the shares in your trust and keeping separate records (eg a spreadsheet) which you can use to show your daughter how much her share portfolio is worth ?

    It could save you quite a bit of effort, costs and possibly some tax (the tax threshold for under 18s is very small), since you already have the trust set up, and since she is likely a beneficiary of the trust (??) it's not as if she is cut off completely from the asset - it is quite legitimate to distribute the proceeds from that investment to her out of the trust.

    I understand the psychology of having her own investments in her own name - but I think some pragmatism may be useful here - consider whether it would be better for her long term, to structure it differently ???

    Just a suggestion :D
     
  3. Jen

    Jen Member

    Joined:
    21st Oct, 2005
    Posts:
    23
    You're right! I hadn't thought of that and it sure does save a lot of hassle.
    thank you:D