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Hi Amir,
Congratulations on setting up your new business! Your plan to use the income from Company A to buy property in a separate entity (Company/Trust B) is a common strategy for asset protection and tax planning. Here are some options you may consider:
Loan from Company A to Company/Trust B: Company A could lend money to Company/Trust B to purchase the property. This would require a formal loan agreement and repayment terms, and Company/Trust B would be responsible for paying back the loan with interest.
Equity investment by Company A in Company/Trust B: Company A could purchase an ownership stake in Company/Trust B in exchange for the funds needed to purchase the property. This would make Company A a shareholder or member of Company/Trust B, entitling it to a share of the profits and potentially providing a tax advantage.
Payment for services rendered: Company A could pay for services rendered by Company/Trust B, such as property management or consulting fees. In exchange, Company/Trust B could use the funds to purchase the property.
It’s important to note that each of these options has different legal and tax implications, so it’s important to consult with a qualified accountant and/or attorney to determine the best option for your specific situation. They can help you navigate the complex tax and legal regulations surrounding business and property ownership, and ensure that your plan is structured in a way that is compliant and effective.
