If this is your first visit, be sure to
check out the FAQ by clicking the
link above. You may have to register
before you can post: click the register link above to proceed. To start viewing messages,
select the forum that you want to visit from the selection below.
Header Ad Module
Collapse
Announcement
Collapse
No announcement yet.
Set up a company and hire myself as a property manager
Following on from Perry's comments, if done correctly there is no real issue.
Often there would also be no advantage. ie Joe rentals pays Joe property mgmt $10,000. Rentals makes $10,000 less or a loss of $10,000. Management makes $10,000 more or $10,000 profit. Loss cancels out profit = no difference and no tax advantage.
Ross
Book a free chat here
Ross Barnett - Property Accountant
The benefit as I see it is the bank classification... At least one bank I work with classifies you as a commercial customer if you take income from your property portfolio for work you do (I.e maintenance or management) it is considered that you're living off the rental income however if you pay a company to do same work you can remain a residential banking customer... Even if the company doing the works is owned by the entity that holds the title and mortgages on the property they're in invoicing...
no tax dodge... In fact there might be more tax payable but it may avoid commercial banking rules/rates.
the interesting thing is that being a commercial bank customer may allow you to borrow above 60% as an investor... The rules for commercial lending were 65% last time I checked... Not sure if they've changed now resi has gone to 60%
Comment