DAVENPORTSH A R B O U R L A W Y E R S

www.davenportsharbour.co.nz

STRUCTURING OF LOANSSTRUCTURING OF LOANS

Tammy McLeodTammy McLeod

September 2014

DAVENPORTSH A R B O U R L A W Y E R S

www.davenportsharbour.co.nz

1. Where there is a Trust2. Where there is a Company3. Property Relationship issues4. Assisting children into Property5. Advising on Guarantees

What we will coverWhat we will cover

DAVENPORTSH A R B O U R L A W Y E R S

www.davenportsharbour.co.nz

• Borrowing in the name of the Trust

• Except revolving credit facilities

• Guarantees from individuals

1.1. TRUSTSTRUSTS

DAVENPORTSH A R B O U R L A W Y E R S

www.davenportsharbour.co.nz

• Tax deductibility of borrowings:

Income producing assets Re-arrange shareholders current accounts Restructure if keeping current house as a

rental

DAVENPORTSH A R B O U R L A W Y E R S

www.davenportsharbour.co.nz

• Borrowing in the name of the Company

• If property company, use revolving credit facility to fund deposit

2.2. COMPANYCOMPANY

DAVENPORTSH A R B O U R L A W Y E R S

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• Where should the borrowing sit?

• Separate loans

• Property sharing agreements

• Relationship property agreements

3.3. PROPERTY RELATIONSHIP PROPERTY RELATIONSHIP ISSUESISSUES

DAVENPORTSH A R B O U R L A W Y E R S

www.davenportsharbour.co.nz

• GiftGift Deed of gift Conditional upon contracting out

agreement Can you do the same for all

children?

4.4. ASSISTING ASSISTING CHILDRENCHILDREN

DAVENPORTSH A R B O U R L A W Y E R S

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Loan agreement Lend to child and partner Interest? Or, link to capital gain? Repayable

• LoanLoan

DAVENPORTSH A R B O U R L A W Y E R S

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Share in property recorded on the title

Property sharing agreement Interest? Or, link to capital gain? Repayable?

• PurchasePurchase

DAVENPORTSH A R B O U R L A W Y E R S

www.davenportsharbour.co.nz

Don’t sign Limit guarantee

Guarantees chain

5.5. GuaranteeGuarantee