All Topics / Help Needed! / Real positive cashflow/gearing

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  • Profile photo of trajiktrajik
    Join Date: 2005
    Post Count: 102

    When you talk about positive cashflow/gearing[baaa], is it normally before tax effects or after,

    Profile photo of FUNFUN
    Join Date: 2002
    Post Count: 31


    I think the answer varies amongst individuals but I prefer to think the real +ve cashflow deal is one before tax. Because if you need to take into account the tax effect in order to get +ve cashflow, you will eventually max out the tax benefit.

    Just opinions from novice.
    From FUN

    Profile photo of Paul DobsonPaul Dobson
    Join Date: 2003
    Post Count: 1,196

    Hi Trajik

    I agree with Fun, I regard it as “before tax effects”

    Cheers, Paul

    Paul Dobson | Vendor Finance Institute
    Email Me | Phone Me

    An alternative way to finance your home.

    Profile photo of DazzlingDazzling
    Join Date: 2005
    Post Count: 1,150

    I always consider “before tax” to be me and the Govt.
    I always consider “after tax” to be just me.

    Really, I’m more interested in just me.



    “No point having a cake if you can’t eat it.”

    Profile photo of pete rpete r
    Join Date: 2004
    Post Count: 80

    Hi Trajik,

    There are many factors that will influence the tax benefits if any and as such may be unpredictable or unforseen. e.g. losing one’s taxable income (job), or reduction in income etc.

    In Steve’s templates the sums are done prior to tax considerations, and for me if I am evaluating a property I would like it to be CF+ before tax. Then, if there are any real tax benefits they are a bonus.

    Like capital gains the tax effects can change as can other factors to change an investment from CF+ to CF-. Having the investment CF+ before tax provides a bit of a buffer.



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