All Topics / Hotch Potch / Should I invest with my company or in my persname?

Viewing 7 posts - 1 through 7 (of 7 total)
  • Profile photo of Agent007Agent007
    Participant
    @agent007
    Join Date: 2003
    Post Count: 61
    September 30, 2003 - 11:44 pm

    Hi,

    Here’s for my first thread…..

    My wife told me this very morning to get off my a**s and go and buy property. She’s getting sick off me always studying shares, propety, business etc. and wants me to take action from today.

    So…. I have to get my system & team together.

    Firstly, I am a sub-contracted New Homes Consultant for a major project builder in Adelaide. I have a company (Pty. Ltd.) which I do my new home sales & internet business through.

    My property investment strategy is to purchase as many +ve cashflow properties from today onwards, until we reach our personal goals.

    QUESTION: Should I start investing using my existing company structure? Start a new company just for property? Or just invest in my (or me & my wife’s names)?

    BTW my only company debt is about $19,000 left on the loan for my company car, and a grand or due on our personal credit cards. Our PPOR is 100% freehold.

    Any accountants out there?

    Thanks a lot for any help.

    Cheers,

    David Paxton
    New Homes Consultant
    Sterling Homes
    0412 853 395

    Profile photo of MelanieMelanie
    Member
    @melanie
    Join Date: 2003
    Post Count: 382
    October 1, 2003 - 12:00 am

    Hi David, welcome aboard! [:D]

    I’m a mortgage broker not an accountant, but from what I’ve learnt, if you guys are serious about buying many many properties I’d probably recommend setting up a discretionary trust with your co. as trustee and buying all new property in the name of the trust. You would sign for the loans as director of the trustee company but assets are protected and long term many tax benefits as well.

    You may need to obtain deposit finance via a Line of Credit (LOC) loan over your PPOR but I’d keep the loans for the new properties seperate. The interest on the LOC over your PPOR is a tax claimable expense as the purpose of the funds is investing. Also cash flow positive properties are pretty easy to self-service with enough deposit to cover costs and min. deposit to bank depending on the area you’re buying in.

    Hope that makes sense.

    [:)]
    Mel
    [email protected]

    Profile photo of BillfromozBillfromoz
    Participant
    @billfromoz
    Join Date: 2003
    Post Count: 381
    October 1, 2003 - 3:42 pm

    G’day David….

    No I haven’t forgotten you…just got swamped.

    Melanie is spot on in her advice.

    You may not be aware thta the ATO recently lost an appeal re : capitalising interest on investment loans.This has an enormous compounding effect. More desirable with a home loan in that you channel ALL funds into the family home loan including the interest you would normlly pay on the investment property. Home loan zeroed in 3-5 years…I did one in 18 months.

    I will be sending you info to get the ball rolling
    it wil require that you complete the analysis and return for the nunber crunching to give you a nine page report…. worth a fortune but no fee involved

    Cheers

    Billfromoz

    Profile photo of Agent007Agent007
    Participant
    @agent007
    Join Date: 2003
    Post Count: 61
    October 1, 2003 - 11:29 pm

    Thanks Bill & Melanie.

    I look forward to your analysis… (I did spell that right didn’t I?)

    I rang my accountant yesterday. Even though he only has one IP (a unit in a retirement village) he has heaps of client’s that are, and he is very confident in getting me in the right structure.

    But I also value the view points on this forum from those who I ventured before us.

    Cheers,

    David Paxton
    New Homes Consultant
    Sterling Homes
    0412 853 395

    Profile photo of DevoDevo
    Member
    @devo
    Join Date: 2003
    Post Count: 28
    October 2, 2003 - 12:56 am

    Hi Billfromoz

    I would be very interested in gaining a little bit more knowledge on the ATO losing it’s appeal re: captilising interest. Do you know of a web site where this has been published? Sounds like a handy piece of info.

    Cheers
    Steve

    Profile photo of AdministratorAdministrator
    Keymaster
    @piadmin
    Join Date: 2013
    Post Count: 3,225
    October 2, 2003 - 3:48 am

    Hi Bill, are you referring to the federal court ruling last year, or the result of the High Court appeal? I couldn’t find any reference to a result for the High Court ruling anywhere on the www as yet, only that it would be decided near the end of this year.
    Thanks, Jim.

    Profile photo of TerrywTerryw
    Participant
    @terryw
    Join Date: 2001
    Post Count: 16,213
    October 2, 2003 - 12:10 pm

    David

    I agree with Melanie, but would start a new company to act as trustee, not the one your are using for business. It adds more protection in case the trustee is sued.

    Bill
    I had heard the high court appeal was comming up sson, but didn’t know the ATO had lost, (are you sure-it would have been widely publicised I am sure?)

    Terryw
    Discover Home Loans
    North Sydney
    [email protected]

    Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
    http://www.Structuring.com.au
    Email Me

    Lawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au

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