What is better to hold investments, a company or a trust?
A company is taxed at 28% and a trust at 45%, so it’s a no brainer, or is it?
If you own shares in your investment company and you go belly up financially, the shares will form part of your insolvent estate and will be sold. Not good.
If your trust holds the investments, they are protected from your creditors, but what about that tax rate?
Best is for your trust to own a company which, in turn, owns the investments. Income is taxed at 28% and the investments are protected from your creditors.
Now, that’s a no-brainer!