So on Tuesday I was in the front row of the audience at the Press leader’s debate between David Cunliffe and John Key. It was an exciting occasion and great to have so many people interested in politics in the Ilam electorate. I went with my parents, my grandmother and my great aunt – the latter who both live in Merivale, but vote very differently! I think watching it in the room is quite different to what happens on the livestream. Firstly, it was VERY loud. Both the debaters, and the crowd. Key got a warm welcome but DC’s was louder. The two men talked over each other quite a lot, which wasn’t the most satisfying auditory experience.
Key started really angrily, and talked over David a lot. Most questions seemed to be given to Key for 30 seconds, for him to then talk for 90 seconds, then passed on to David for 30 seconds, at which point Key started sniping at him and not allowing him to answer. While I’ve seen some people comment that they thought the (lack of) moderation was fine, it made for a number of occasions where both men just talked over each other, as if the first person to stop talking was less of a man or something. Key’s question about CGT on houses in a trust did seem to catch David, but he was right to check and see. It’s a complicated issue and it’s worth being right on it.
As with the first debate, most of the commentators seemed to make up their minds about “who won” based on the early exchanges. Key was definitely much weaker in the second half. This was because if focussed on Christchurch issues, and National’s record on this is poor. When he announced that Gerry Brownlee would be CERA minister after the election, this was received with boos. There was laughter when he claimed that the CBD was “booming and almost full“. There was confusion when he started telling Press editor Joanna Norris about an advertorial supplement that will appear in the paper next week. And when he said that the government wouldn’t want to “run roughshod” the Anglican church (when talking about the Cathedral) one was reminded of some of the other institutions that this government has run roughshod over – including ECan and the CCC.
Cunliffe spoke well on these matters, as he has done over the last 3 months of the campaign in the city. He knows that Labour’s policy is popular here, as he has been down here to announce it, and has talked with hundreds of residents who are in difficult situation. Instead of just making light of people’s real hardship like the Prime Minister, Cunliffe has showed an empathy that Key lacks. While the media in Auckland and Wellington might have called it one way, the people in Christchurch were only presented with one leader who understands the issues in this city, and it wasn’t the Prime Minister.
... 
Re the trust question.
Key ask about if a HOME was in the trust, NOT the FAMILY home.
A family home is the principal home of residence. It is pretty fucking simple.
You can try and mess around with ownership structure. i.e lets have it owned by our company whose shareholders are my trading trust and my family trust.
It does not matter how it is owned. It matter whether you live there or not.
Simple.
“A family home is the principal home of residence. It is pretty fucking simple.”
My wife and I, together with our children, live in a house we have occupied for 10 years. It is the only property we spend time in. By your definition it would seem to qualify as a family home.
We rent the place off a landlord who owns it through a trust he controls.
I assume that this is so simple as to mean that it is exempt from CGT, if he were to ever to sell it?
Um, no.
Your landlord does not live in it, you do, therefore this is not your landlord’s principal home of residence. Therefore, when the property is sold, it will be liable for capital gains tax.
It really is pretty simple.
But the “owner” doesn’t live in most properties that are owned by trusts, do they?
I understand, and I am not a lawyer, that when people set up a family trust they hand over their assets to a trustee, who becomes the legal owner of the items. This person is NOT the original owner. If a house is passed to the trust, for whatever reason, and the original owner continues to live there then the legal owner, the trustee, is in exactly the same position as my landlord. That is they own the property but do not live there.
If the case that Cunliffe is talking about is exempt then why is not a landlord who holds properties via a trust not in the same situation?
I realise that you can make a distinction between the two cases but the explanation in the Labour Party policy certainly doesn’t. Are they only telling us part of the truth?
It really isn’t as simple as you say I suspect.
Trusts are fairly much useless – just look through to who the beneficiaries are. simple.
Pretty sad you can’t understand this simple concept.
The landlord owns a property through a trust. The landlord does not live in the property. The landlord rents the property to other people that live in it.
Therefore, the property is not the principle place of residence of the landlord, so when it is sold, CGT accrues.
You seem to not understand the “owns a property through a trust” part, which is weird.
If you can please explain to me where I am wrong in the following scenario I may be in a position to accept your opinion.
1. Properties put into a trust are owned by the trustee. Y/N?
2. The people who live in the property are normally the former owners, ie the ones who transferred the property to the trust. Y/N?
3. They, although living in the property do not own it. Y/N?
4. The beneficiaries of a trust are not normally the people who set up the trust. Y/N?
How come that when the property is owned by someone who does not live there CGT is not payable (Cunliffe) unless it is payable (also Cunliffe).
After all, one of the main reasons people set up a trust is so that they DON’T own their house and don’t have to realise its worth to pay for care in old age.
Another is so that they can’t get caught if there business, eg a law firm, goes down the tubes in a spectacular crash and they might have to realise everything they own to pay off the debts.
Simple: If beneficiaries of the trust are living in the house then the house is a family home. If house is not occupied by the beneficiaries of the trust, then the occupiers should be paying rent to the trust and the house is not a family home.
Alwyn trusts have very little defence against bankruptcy etc after changes to laws last november all they can do now is guarantee the inheritance of the families children ahead of a will!
with the last $118,000 per parent not allowed to be taken for care costs in old age!
Otherwise any profit is taxable now!
Then their is the cost of setting up the trust!
Which has a Ryder at the end which every lawyer has to now inform client that their is no guarantee , the govt can still come and tale what it needs for elderly care!
So rather than paying 15% CGT a trust will have to pay the top tax rate and reimburse any claims for maintenance and depreciation!
A trustee is usually the settlor and a beneficiary, and the home that person lives in is their family home.
So, if the settlor is a trustee they “own” the home they live in and are a beneficiary too
The settlor is not necessarily or even usually a beneficiary of a family trust (and that’s what we are talking about here), as I understand it, but is usually a trustee – ie co-owner with the other trustee.
But I agree with Draco below. Except under exceptional circumstances, like caring for a disabled family member, or to allow the children of a dying parent to have essential domestic bills paid immediately after the parent’s death, trusts should be banned.
The solution is to get rid of trusts. They don’t seem to have any legitimate use any more.
Not so. Original reason stands. EG. My bro in law is intellectually and physically disabled. His mum set up a trust to manage her estate when she died to ensure he didnt get any money directly which could then be swindled by an unscrupulous person.
The trust solf her home and applied the money to his care. He is in residential care but has SKYTV, clothes as he needs them, trips, health insurance.
Most of the people he lives with have a small amount after their accom is paid for from which to live.
It is sad. The trust will pay for other residents to go with him on trips.
There is a place for them but they got hijacked by the greedy and selfish and are not as hard to clamp down on as some suggest.
+1. This whole all trusts are evil thing is not helpful.
Av
“It does not matter how it is owned. It matter whether you live there or not.”
Please stop and think this through. It’s pretty easy to come up with scencarios where that is not the case. There was one in OM this morning,
http://thestandard.org.nz/open-mike-04092014/#comment-879872
Such a relief to watch a debate, last night’s tv3’s minor parties leaders’ debate, that didnt have a rude, sneering, mocking, lying little twat in it shouting everyone else down, preening and giggling at his own put down “humour”.
I’m talking to you Prime Minister. You are an embarrassment. And you, come Sept 20th, can be on your bike.
It won’t be a bike, it’ll be a govt car taking him back to power for three more years
ipredict disagrees with you – the 4 headed monster only just equals the 3 pillars of freedom, with Winston deciding the fate of everyone involved
http://www.electionresults.co.nz/
So put some money on the result, should be an easy win then
Unfortunately the brighter future hasn’t happened yet so I don’t have spare cash lying around.
Puckish Rogue counting your chicks before they hatch!
Well their coming home to roost!
This election because its closer more left wing supporters will turnout in bigger no’s
Last election looked as if National would govern alone and ended up with a one seat majority!
Pockish rude doesn’t know the meaning of “a day is a long time in politics.
Bugger of creep. Wait for Kim.com to dump all over your lot.
I posted this on open mike but it fits here as well:
Seriously? That seems to be the refrain of the left.
Just wait until the people of NZ see John Key for what he his (6 years on and still waiting)
Just wait until the people of NZ get to know the real Cunliffe (hes been leader of Labour fior nearly a year now)
Wait until KDC takes down John Key (still waiting…)
Wait until the full effects of dirty Politics are known
Yeah just keep on waiting lefties
Do you write John Key’s stand-up slapstick routines? You’ve got his stuff down pat.
Yes it will be a car. A car that takes him to the Airport to use the one way tickets to Hawaii.
Three cheers to that.AAA++..@ DWBH
Thanks James. And one thing Labour can learn from National, its much easier to stay on top of your policy when you don’t have any.
Thanks for that James. I stopped watching near the start, there is only so much of schoolboy prig of a PM, I can stand. And he was in full attack mode, if his government and policies actually worked, would he need dirty tricks and all the attacks? Would not the merits of policy and law they enacted stand on their own?
Good one James. Key’s ‘zinger’ re the CGT turned out to be a hollow zinger. Last night on the news David Cunliffe said the issue round family homes and trusts is very clearly stated in the policy announcement and he effectively called Key a nasty liar. There was a clip of Key sticking to his guns, like so many things, he can read the policy a different way.
‘Key brought along Mr Nasty’ should definitely become a meme.
Key showed his true self on Tuesday. He was Nasty, Vindictive, Sneering, and dismissive of everything, and everyone around him. And not a pretty sight.
DC didn’t handle the “trust” question well at all and he should have. It was an opportunity to hammer a nail in and he missed it. I was disappointed that he missed that chance- I thought he would be quicker.
That said, Key descended into his usual flippancy and I get the feeling that this is starting to work against him and people are seeking more gravitas. That certainly seemed to be true of the ChCh audience and situation. Perhaps it is an angle that should be pushed. Time for the jokes and “nice bloke” nonsense to stop and for a true PM to step up and take charge. Only one man for that and it isn’t John Key.
Good call James. The nasty side of Key we have often seen when he answers in Question Time, is beginning to show in general public. The staunch National supporters will grit their teeth and stay staunch but the floaters might be turned off.
Ianmac spot on couldn’t agree more here.
It’s refreshing to get your alternate perspective James, and as you were there, it is the most important perspective. It’s also good to hear about the second half the debate, as I missed it. I wasn’t aware it was going to be focused on CHCH, otherwise I would have stayed around to watch it – I just couldn’t stomach any more of Key.
I hope your fellow Cantabs have also had a gutsful of Brownlee and Key. You deserve so much more than the crap that has been dealt out over the last few years.
All power to you for a triumphant victory in Ilam on 20th September!
You folk there in Christchurch,hold your heads high,Democracy will return very soon..The rest of us are also trying very hard to affect that.
Thanks but we’ll be ok once Cunliffe and his over-promising campaign is shown the door
@ Ruckish Pogue,…you gormless twit, Dog whistling from Donkey about tax cuts.Social welfare for the rich.we have 85 billion debt,thats a noose around all our necks,even Blingesh can see that.If you can’t be a Labour supporter.You’ll just have to handring over a English lead opposition.At lest he ruminates at the same speed as a cow.
Key can put his head in the sand if the answers to the questions dont favour him and makes up lies or inaccurate answers and sticks by them just like not reading the dirty politicks book and making it into a left smear when it was practically written by the National party
Luckless Rogue door of the Jail where Nationals corrupt cronies will end up!
Nationals popularity is sliding down and with most polls have overestimated Nationals support !
National are in deep do does!
Given your surname (dishonest mischievous person)
your only kidding yourself!
The willingness of the media to fawn on the PM’s gotcha tactics – regarding calling a debate that the public did not themselves witness, is testament to their inclination to toady for power.
However they cannot do the same when it is a broadcast debate and the public has a chance to call it.
alwyn above 4 September 2014 at 11:04 am
quote
But the “owner” doesn’t live in most properties that are owned by trusts, do they?
I understand, and I am not a lawyer, that when people set up a family trust they hand over their assets to a trustee, who becomes the legal owner of the items. This person is NOT the original owner. If a house is passed to the trust, for whatever reason, and the original owner continues to live there then the legal owner, the trustee, is in exactly the same position as my landlord. That is they own the property but do not live there.
If the case that Cunliffe is talking about is exempt then why is not a landlord who holds properties via a trust not in the same situation?
I realise that you can make a distinction between the two cases but the explanation in the Labour Party policy certainly doesn’t. Are they only telling us part of the truth?
It really isn’t as simple as you say I suspect.
unquote
Alwyn, I get the impression you are well up, and further ahead that me, and most of us, on the confusion and difficulty which CGT would bring us. You will notice that Labour party are running backwards with policy papers. Its an election loser, and the more they talk about it, the worse it gets.. Some high court work needed to sort out this dilemma , but it won’t happen, this is the losing shot.
I would say that the title deed of the home is the owner. Unless that title deed is transferred to the trustees then the Settlor still owns it. This is costly of course, and the reason there is huge discussion. You can not name a trust as owner of home, It must be a person or persons. More confusion. My home which got half wrecked in the Earthquake has title deed my daughter and ex wife as trustees. I pay rent as settlor. We would be candidates for CGT and death taxes. But it won’t happen
You’re neither an accountant nor a lawyer, according to you.
No-one take this concern tr*ll’s partisan drivel seriously. Show me a simple tax law and I’ll show you the list of OECD countries with a CGT.
Another tiny little problem here, the DC trusts, I don’t think the people would be very amused to see the double blind game . I think Draco T stated that Trusts should be finished, and many agree. I agree. They are a nightmare, and the rules are changing all the time. Cullen started the process. I set up Trusts for people and they are worthless. That is the problem . DC operates specifically in contrast with existing and on going Labour policy in this area. And this will get worse, and it finishes the chance of Labour victory. You know the rich pricks thing, and all that stuff, good morning Herne Bay.
Put up or shut up, weasel.
You seem so concerned for him. Have you emailed him, or sent flowers?
“I am not accountant or lawyer.” (sic) Paul Scott.
“I set up Trusts [sic] for people and they are worthless” Paul Scott.
No shit.
One Anonymous Bloke 14.3 4 September 2014 at 4:15 pm
quote
“I am not accountant or lawyer.” (sic) Paul Scott.
“I set up Trusts [sic] for people and they are worthless” Paul Scott.
No shit
unquote
paul scott says: that’s the whole pint bloke , please don’t use sic.
Many New Zealanders like me know that Trusts are finished business.
That is why we question your leader, and even the PM,
We ordinary people certainly disapprove of double blind trusts, but you must go back to leader, and check his Trusts [ heh it will not be fun ]
I am not here for a fight , the outcome is already sure. Of course you could always write your name as I do anonymouse , mouse
Who’s my leader? You lurch from semi-literate contradictions (cf: your worthless trusts) to wildly inaccurate assumptions: you think this is a Labour Party website, and that’s another failure of comprehension on your part.
There’s a simple explanation for all of this: everything you say is offered in bad faith.