Hi guys,
I am looking to buy properties, renovate/hold and resale.
I am thinking of starting my own investment company so I can do this on regular basis and pay less tax?
I will still keep my a full time job and me and my wife will be the owner of the company.
My wife has a full time job as well.
Our income will be supporting the business.
This is just my thoughts but not too sure whether it can be done?
Has anyone done this and share with me some insights?
Thanks!
San
Hi San
Yes i have done it very successfully with a business partner who was a Builder but that is a different story.
One of the issues will be financing unless you have a good equity base as lenders do not like lending to property developers unless they can demonstrate a good track record. You wont get normal residential rates and terms if you are running it as a business and will be required to put in between 20-30% each deal.
Also I am assuming you are licensed tradeperson. if so you might want to check out the BSA requirements in your State as you may find that you will need to be a Director of the Company or have sufficient cash assets in the Company to cover any issues in the even that the Company cannot meet it debt requirements. Certainly this is the case in Qld and has put out of business a lot of smaller Builders who just didnt have the capital requirements.
Richard Taylor | Australia's leading private lender
Consider doing it via a discretionary trust as this will give more flexibility with tax and more potential savings.
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Hi I would like to also ask about business – Would you think it would be a good idea to build your asset base before borrowing to start or buy a business?
Has anyone here done that and what were you thoughts or concerns on it. How many IP's do you think would be a good starting base to borrow against.
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