The Investors Club are recommending I create my own ABN, as it will help with getting loans in future. Any negative ramifications of this, apart from having to lodge a nil-activity form once a year?
If you are creating an ABN for borrowing purposes, then you will need GST registration too – If you need to declare over $75,000 pa income. You will then need to lodge bas statements which is a pain.
If your 'business' is not creating an income the ATO will cancel your ABN after a while too. However you can get around this if you have a good reason.
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
yeah, will gst register. thanks terry.
How do you get around the nil BAS statement for a while Terry? I to was told to get ABN & GST registration for borrowing purposes but put in nil returns.
What happens if ATO decide to cancel it!
Vic,
You can lodge a Nil return for as many quarters / periods as you like.
If the ATO believe the ABN is inactive they may look to cancel it however you would merely state that the business is pending and you need to retain it.
Richard Taylor | Australia's leading private lender
You can apply for an ABN without registering for GST. When you think your business income – including commercial rent – is over $75,000, you will then need to register for GST. This will save putting in the nil BAS returns.
Dan
This is all well and good however you wont be able to obtain finance with most remaining lodoc lenders as the GST registration is less thank 2 years old and is the main purpose of the post.
Richard Taylor | Australia's leading private lender
Do the lenders look at your capital growth as perceived Income also.
Example salary $80k
Rent $25K
Capital growth at 5% on portfolio worth $1M = $50KSo your gross Income is $155K
Is that how the banks look at your calculations for borrowing and serviceability?
I understand that Ed Chan was saying that capital growth was classed as income..
Vic
No lenders do not classify Capital Growth as Income.
Depending on the actual wording in the Lodoc Declaration a Realised Capital Gain maybe considered.
Richard Taylor | Australia's leading private lender
I agree with Richard – unrealised capital gains can't be classed as income. Even if there were realised capital gains lenders would still, generally, not want to include that income as they would say it is 'one off' – ie. not regular income.
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
I have had an ABN for about two years now, can i apply for GST registration and backdate the application?. I believe that low/no doc loans are designed for self employed income, so how can it apply for people on paid salaries?.
Yes you can backdate the date of registration for GST.
Bluegum
Yes as Dan mentioned you can backdate the GST registration but not sure i would go back 2 years.
Lodoc loans are primary for self employed clients but there are still one or two lenders (unfortunately some of the better Lodoc PAYG lenders have gone) who under a given percentage will accept PAYG clients also.
Richard Taylor | Australia's leading private lender
I am new to this website and would firstly like to say its fantastic…. It may take a while to sort through all the topics but well worth it
I have recently set up an ABN (without proper research) is it as simple as putting a property into a bussiness name or is more
complicated than what it seems on top of making finance difficult as my Job is the primary income source….Hi fredo
Firstly welcome to the forum and I hope you enjoy your time with us.
The main reason why clients register for an ABN is merely to give them flexibility when it comes to finance options.
If you intend to purchase property in your personal name and your PAYG employment is your sole source of income then probably not required.Your mortgage broker should be able to explore the options with you.
Richard Taylor | Australia's leading private lender
fredo_4305 wrote:I am new to this website and would firstly like to say its fantastic…. It may take a while to sort through all the topics but well worth it
I have recently set up an ABN (without proper research) is it as simple as putting a property into a bussiness name or is more
complicated than what it seems on top of making finance difficult as my Job is the primary income source….A business name is just a name. The person or company or trust behind the name owns the assets
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
You must be logged in to reply to this topic. If you don't have an account, you can register here.
