hi all been reading the posts and i have picked up alot thanxs all,,i was reading about positive and negative ,,i think it was from steve well i lost it just when it got interesting and now i have seached but can not find the same article does any one know where it is on this site ,also i have just registered as a company i was going to put my nick name as reggie but my accountant said it had been taken ,and i noticed that this name appears here so would this be the same person that has already used this name i wonder!!!!!any way i am excited about this company and the trust but i dont know to much about it, if it is a seperate adentity what does that mean what can i do with it and what can i get out of it. i am about to purches 2 blocks of land through it ,,that, to avoid land tax ,,,can i use the eqity once it grows ,would that be like have cash flow in the company ,,and also my 20year old, daughter is very keen and <smart> to start in this way , she has a steady job and gets around 36,000 a year so ,,,,can i help her in any way maybe through the company ???????or trust ,all i know is that a company will be good for land tax and thats about all, and liabilaty so if any one can give me some pointers i would be most grateful ,also i have a sister in need of help can i maybe help her in the way of leasing with option to buy ie ,,i to find a house for her and lease it to her cause she cant get money through the bank ,,there must be some way ha ha not to save the world but at least to help my familiy after all thats what makes me happy :>
Hi Trying,
The articles you’re looking for – I think you’ll be able to find them at;
https://www.propertyinvesting.com/positivecashflow
(the one on Positive Cashflow)https://www.propertyinvesting.com/strategies/negativegearing
(the one on Negative Gearing)You mention you’re having trouble understanding about companies and trusts.
Steve has been hard at work with Paul Harper (expert accountant from Jeena Partners in Melbourne) on a new information resource on structures. It goes through the intricacies of structuring, the pros and cons of each option, all related to asset protection and tax minimisation – and all in easy to understand plain english.
The resource will be called “Wealth Guardian” – keep an eye out for it in the Resources section of PropertyInvesting.com
Things like helping your daughter out through the trust – this can be done. In the mean time, while the Wealth Guardian resource is developed, it’s best to talk to your accountant about this.
Finally, you mention buying land, waiting until the equity grows, and having cash flow in the company.
Be very careful not to put equity and cash flow in the same basket. If the value of your property holdings goes up – that’s equity. If your property earns you a dollar – that’s cash flow.
You can go to the supermarket and buy groceries with the dollar you earn through cash flow, but without selling it somehow, you can’t spend a dollar of equity.
Keep the questions – it’s one of the best ways to learn.
Warm Regards
Brent
Edited by – [email protected] on 23/01/2003 09:36:16 AM
Hi Trying,
Oh dear… might I suggest that you are on the verge of making an expensive mistake? Not because of what you have done, but because of your lack of knowledge about how it works and how to set up an effective structure.
Brent is right to point out about Wealth Guardian, but that is still a month or so away.
In the meantime, I’ll try to help with some of your questions:
quote:
…i am excited about this company and the trust but i dont know to much about it, if it is a seperate adentity what does that mean what can i do with it and what can i get out of it.Who set up the structure for you? I strongly suggest you go back to them and get answers to your questions. Especially so with your plans to purchase land… do it b4 you buy as it could be expensive to change later on.
quote:
i am about to purches 2 blocks of land through it ,,that, to avoid land tax…It is illegal to avoid tax. Be careful with your choice of words as it underpins your intention.
quote:
…can i use the eqity once it grows ,would that be like have cash flow in the company…This is not right. You might be able to access the equity from any capital growth, but to do this you will need to refinance (no easy process), plus, if you use that equity to finance your lifestyle then the interest on the lifestyle related debt will not be deductible.
Understanding this underpins my recurring +ve cashflow focus.
quote:
and also my 20year old, daughter is very keen and <smart> to start in this way , she has a steady job and gets around 36,000 a year so. Can i help her in any way maybe through the company or trustWhat kind of help do you want to provide? There is some room for income splitting as your daughter will be on a tax rate of 30% This means that if your marginal tax rate is >30% then it would be better tax-wise to distribute to your daughter rather than to you. BUT!!! This raises all sorts of issues for which you need specific financial advise.
quote:
…all i know is that a company will be good for land tax and thats about allHmmmmm…. I wonder why you think this? Could you pls expand as from my knowledge there is no benefit from holding land in a company from a land tax perspective.
quote:
…if any one can give me some pointers i would be most grateful…Seek advice from a good accountant… quickly! You have a little bit of knowledge that seems to be potentially dangerous.
Good luck…
Steve McKnight
**********
Remember that success comes from doing things differently.
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Steve McKnight | PropertyInvesting.com Pty Ltd | CEO
https://www.propertyinvesting.comSuccess comes from doing things differently
thanks brent and steve for your in put ,,firstly i want to let you know that i dont do any thing before i speak to my accountant and broker because i know very little about it all ,as for equity and cash flow i know what you mean ,i think im just very bad at wording things i dont mean to say i will have actual cash in hand i dont want cash for life style as yet ,as i am self employed and have that cash flow to work with .well a bit left,i have 3 ip that is negative gearing at this time so if i purches these 2 lands than ill be at my limit,for now ,any way so i am thinking that i need to turn my ips into positive cash flow but the only way i can think of is to sell one at least but than i will not have 3 only 2 and so i feel i will be going backwards <not what i want> so some how i have to reduce the loans on them ,but it doesnt happen over night ,so i thought some how i could buy and hold the land ,than sell or better still build and then sell but that would be more loans than now so i am not winning that way.i have 1 peice of land that is just there no income ,so i should build on that ,but which ever way i look at it i will have to get a loan so here we go again more moneyto paythink i will wait for this book to come up and than i will have a better picture on what to do .my daughter wants to go to queensland and start there ,ie geta buisness and start in realestate ,i think she will do well .i thought once you reach your 260,000 in land value you have to pay land tax hence the trust ,,have a great weekend guys
Regarding “tax avoidance”:
Tax EVASION is illegal, but tax AVOIDANCE is not only legal but should be everyone’s aim!
quote:
Regarding “tax avoidance”:Tax EVASION is illegal, but tax AVOIDANCE is not only legal but should be everyone’s aim!
I think tax AVOIDANCE is the wrong word to use!
You possibly mean “MINIMISATION is not only legal but should be everyone’s aim!
I don’t see the point in evading or avoiding tax when there are plenty of legal ways to effectively minimise one’s burden……
cheers
wattoEdited by – [email protected] on 03/02/2003 8:45:17 PM
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