Hi Michael…
You say that your only interested in 3 bedders???
If that truly is the case then my advise would be to open your options.. Then again your asking for suggestions so I guess you are opening your options..I own a company too. However not one of my properties have been purchased through it.. That would be a bad tax move.
The company is great for me to have my clients pay into and from there pay me and my wife.
It also allows us to have our car, that we use for our business to be paid for using pretax dollars. Other things too.However the bank will not take your company into account when going for a personal property loan. But by the sounds of it the personal worth side is in your favour.
Get yourself a good mortgage broker. DO NOT, i repeat DONOT go directly to the bank for any kind of property loan. The guy behind the desk at a bank is probably cringing that you already own 3 more properties than him and will make it impossible for you to get anything. Believe me, this is what happened to me a year ago.. so find yourself a broker that has a big expensive house and lots of investment properties like i have found and let him ask you, what do you want??
My suggestion is to refinance all of your properties and establish lines of credit for upto 80% and use that free money to buy a diverse portfolio of properties. +ve gear them and the banks that your broker works with will always be happy to give you more.
Put some deposits on some “quality” off the plans and flick them b4 settlement for some nice bonus cash. Sure you have to pay tax on the earnings but that means your making money.
This will also give you nice cash injections for deposits on bigger investments.
Think quick. Act quicker. Show no fear.
I like to drive really expensive cars that I will be able to afford in coming years to inpire me.. Find something that you can do to inspire yourself but doesn’t cost you money.. It’s all fun.. So is property..Do not tie yourself to one single strategy. Their are many different ways to skin a cat. Not that I’ve skinned a cat b4 but you get what I mean.
Think outside the Dohdecahedron.
BTW being straight up, Blunt, Arrogant in other peoples eyes should mean that you are Confident in yours. It’s all good.
Good luck
Calron the Alcamist
Turning things into gold is fun.
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]Max 1999 if you buy a property and renovate it, the costs of the renovation will be added to the cost base of the property. So if you buy a property for $200,000 and throw another $100,000 (big figures in whole dollars are easy to work with), your cost base for the asset (property) becomes $300,000. If you then sell that property for $500,000 you pay Capital Gains Tax (CGT) on the difference between your cost base and your selling price (less things like legal fees and stamp duty etc.) Therefore you would pay CGT on $500,00 less $400,000 = $100,000.
You pay tax on capital gains dependant on the marginal tax rate you are sitting in, ie. 17%, 30%, and so on. Whatever capital gains you make in a year is added to your other taxable income and then taxed at the appropriate marginal rate.
As for buying property in a company, see my other post in this topic (I think) about structuring. Buy in a trust for tax reasons never in a company. I’m certain there are people out there who will disagree with me!!!
Melanie, the company rate is now 30% fixed, therefore any profits in a company are taxed at 30%. You can retain the profits in a company, unlike in a trust, and whatever tax you’ve paid on those profits can be utilized to pay a fully franked dividend in the future. This all gets a bit technical. Melanie how do you know of Dymphna Boholt…..I used to work in her practice hence my knowledge of structuring for asset protection. Yes she is brilliant at what she does.
Hi Paulette, I’m Michael from Perth
Consumer Affairs in most states are looking very closely at wraps. There is also a move to put property and property advice under the same stringent rules as finance and financial advice.
They are concerned that wrappers aren’t finance companies, and that purchasers don’t have consumer protection – if you default on your payments and the bank takes the property for example.If you buy and sell within 12 months you don’t get the 50% CGT reduction – if you are doing well you pay 48.5% tax. Also, you get large ‘lumps’ of income at intervals, so you may pay top rate tax one year and little the next. Even when you DO hold for 12 months, the 24.25% CGT isn’t too far from the company 30% rate, whereas 48.5% is a LOT more than 30%. Also, if you do this several times a year, the ATO will call you a PROPERTY TRADER and not use capital gains rules at all.
The company can pay 30%, hold/use the money, then distribute to you whwnever you like, you credit the 30% towards the tax payable at the end of the year (any excess gets refunded). Be aware that if you DON’T use a company you will have to register YOURSELF and pay tax quarterly.
You may wish to register for GST if you pay out enough GST to be worth claiming back.A company should find it easier to claim deductions for things used in running the business (computer, consumables, car, sending you to Queensland…). The ATO is very wary of giving individuals deductions for things which COULD be used personally.
I have been searching for reno properties myself and would be like to talk to you or anyone else in Perth interested in sharing ideas or collaborating.
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Piont well taken Calron,
Thank you
I’ve always believed people make the boundries of our paradigms.
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MichaelCalron takes the cake – again! [
]Good to see this thread still thriving! Kelly I met Dymphna at a Property Riches 2003 three day seminar (my first!) in mid-July, she was the ‘expert’ on tax and structures and took the audience by storm. I actually spent Saturday afternoon at a small 5 hour conference she held at the Sunshine Coast Uni and again came away totally inspired – she is very entertaining, but more importantly, VERY active and lateral thinking in the property & tax areas.
For anyone interested, Dymphna Boholt’s contact no. is 07 5479 4455. Do you still keep in touch Kelly?
Speaking of active, must run away and do stuff, ie extract myself from this addictive forum. Have a prosperous day everyone!!
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]The topic ‘How to start with $800K + 3IP’s ?’ is closed to new replies.
