Dodgy shelf Company - beware

Question: Our client has decided to move to a company as trustee of their Self Managed Super fund to reduce land tax. I approached a shelf company group. I asked about Special Purpose Trusts and (although I dont need it on this one) a Division 7A Loan Agreement in the company constitution.

The answer I got was unconvincing. I asked them which law firm prepares their company Constitution. They told me that they dont use a lawyer. They told me that I would have to take out insurance if anything goes wrong with the shelf company. They said, that they do not have any lawyers Professional indemnity insurance covering their shelf company documents. I rang my professional body and they told me that I cant get insurance for shelf companies prepared by shelf company manufacturers. So I am not covered.

I have been a conservative person all my life and am annoyed that this dodgy business was providing un-insured legal documents to me.

Category:

News & Politics

Tags:

• Shelf
• company
• companies
• set up
• buy
• professional indemnity
• cover
• protect
• protection
• accountant
• adviser
• tax
• taxation
• insurance
• constitution
• trust
• trustee
• special purpose
• land tax
• division 7A
• dodgy.