Hello Zimonya, and welcome to the forum.

Trusts do not pay tax – the beneficiaries do. Any capital gain is also passed to the beneficiaries, so you can minimise this if you do it right.

Companies don’t pay CGT, they just pay tax at 30% – which is the highest rate for CGT if assets are owned more than one year.

Trusts are also more flexible, and provide better protection than do companies.

I would suggest you look at obtaining Tax Battles and/or Trust Magic written by Dale Gatherum Goss. They will really explain how you can minimise income using trusts.

http://www.gatherumgoss.com

Cheers
Mel

Dan, I’m pretty sure that the answer to both your questions is No, that investing either in business or other things comes out of after tax dollars.

Do you have a good accountant? Maybe you need to find one who is creative, and who can help you legally ‘spend’ your pre tax dollars on things that you otherwise would buy with after tax dollars, thus reducing the profit, and increasing the benefit to you?

Cheers
Mel

Hi Kay

Yes, HK does go for predominantly new properties, but he also discussed reno’s quite a bit, and how to get wholesale prices so that your reno looked the best for a cheaper amount. Also ‘older’ properties if you could get longer than normal settlements etc.

As for buying strategies, I actually do prefer a growth strategy to a purely positive cashflow. I probably wouldn’t buy for any less than a 6.5 – 7% rental yield, but wouldn’t necessarily be chasing the higher yields just to have it be positive.

I have made far more money out of holding my properties long term than I reckon I could do out of cashflow. I’m only 29, so I see that I will probably continue with some sort of ‘income generating’ work that I do myself rather than just relying on the properties.

I’m not looking to buy anything (other than Paddington) for at least the rest of this year. I’m rather highly geared (and rather unemployed[]) so couldn’t really get a loan now anyway[V]. I’m sort of counting on the rents picking up over the next couple of years while I look at other avenues to provide the cashflow.

Cheers
Mel

Plane A will take longer cos if they travel home at the same speed, plane B will go faster with it’s tailwind.
Presumably they both leave Sydney at the same time.

Agree with the guidebook!

Cheers
Mel

aussie, where are you?

It does sound very much like a drug deal?

Is what the ‘package’ is relevant? Is the fact that she didn’t knock relevant?

Cheers
Mel

I would love a government to cull all the dead wood in the public service, but it doesn’t happen.

If packages are offered, only those who were retiring anyway, or know that they can get a job elsewhere put their hand up. So all the productive people leave, and the dead wood remain, and all collect together.

In my workplace (former, as I am unemployed as at 1700 today []), I reckon more than half the people are dead wood. About a quarter of the rest do enough work for 3 each, and the others bitch about having too much work to do. If only they could all pull their fingers out, twice as much could be achieved with half the people, and the excess could be redeployed where they would be useful…..

My 2c. Although I’ve got to watch the pennies now….

Cheers
Mel

Very true and valid yack, but there are some people who can only afford to buy the $30K properties to start.

All bar one of my properties have been purchased for growth rather than cashflow, and I think that that trend will very much continue. I am looking into alternative investments that will give me the cashflow to continue to buy growth houses. Plus, I like paying no tax []

Cheers
Mel

There’s a few sites listed here that people posted in answer to the same question a while ago.

One company is http://www.fsbo.com.au another is ANREPs (don’t know their website). http://www.selfsell.com.au

Cheers
Mel

Paying yourself first is most definitely ‘investment’ money.

Buying a tv or video etc. is not paying yourself first, cos this money is then gone. You need to reinvest the money you have, so that it can pay you again and again.

I like John Burley’s words on spending the interest, or what your investments have earned. He calls spending that money ‘killing the babies’. If you spend them, they cannot grow up and earn you more income.

Cheers
Mel

But you don’t have to make the decision until you sell. However, it would be a good idea to get a valuation done on the house you move out of when you move out. Talk to your accountant about this.

Cheers
Mel