Clear as ???

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I guess it is too much to ask for any new legislation to be clear and understandable, but I do still have to ask why the new budget changes are as cloudy as they are.  Most things are clearish, however the changes to the treatment of LAQC’s is downright weird.

Initially from the public speech it appeared that LAQC’s would become fashionable again because of their tax rate being lower than trusts.

Since the speech however industry heavyweight Matthew Gilligan has been in discussions with IRD and researching the fine print of the legislation and basically things could go either way. There are a number of things “subject to submission” that could make an enormous difference to an investor and make an LAQC a good thing or a terrible thing .

Right now it is impossible to say whether we should use LAQC’s or not, which is ridiculous in my opinion.

I’ll get Matt to give us all a heads up as he sees a clearer path ahead but this just goes to show that there will always be work for lawyers as long as we have politicians.

It’s similar to my discussions with the REAA asking for a clear opinion on their new rules surrounding traders. I have been waiting since January for that response but the legislation is so poorly drafted (or complex I’m not sure which), that we are still waiting.

So make sure you get very good advice before doing any new or restructuring around property.  Even if you have good lawyers and accountants this area is a potential minefield.  I would spend the money to get anything reviewed by somebody like Matthew EMAIL HIM before I signed anything

Stay Inspired and Stay Safe ~ Dean Letfus

The Wandering Investor