Setting up a property company and lending money from consultancy: Consider setting up a corporation tax regime for potential tax savings on property investments, but consult with an accountant for personalized advice.
Ravi, an IT contractor, asked about setting up a property company and lending money to it from his consultancy company to use as a deposit for property investments. He was interested in this strategy as a way to potentially save money on taxes, specifically by avoiding taking money out of his middle band dividend allowance. Rob explained that this strategy involves setting up a corporation tax regime, which could involve paying back the loan within 9 months to avoid paying corporation tax on it. However, Rob cautioned that tax advice can be complex and may not be completely accurate on the podcast. Ravi was encouraged to consult with his accountant for more detailed information and to review the show notes for additional resources. Overall, Ravi's question highlights the potential benefits and complexities of using corporate structures for property investments and the importance of consulting with tax professionals for personalized advice.
Borrowing from a company for property investment: To efficiently borrow from a company for property investment, establish a formal loan between two separate companies with a commercial rate of interest.
When it comes to borrowing money from a company for property investment, there are options, but they come with complexities and potential taxes. One option is setting up a director's loan, which requires a commercial rate of interest and repayment within 9 months after the accounting period ends to avoid temporary taxation for the company. However, this method might not be the most efficient or preferred way. The best approach is to establish a formal loan between two separate companies, ensuring a commercial rate of interest to avoid any perceived benefits. Remember, we are not tax advisors, but this information is passed along with the understanding that professional advice should be sought for individual situations.
Managing profits and cash flow through inter-company loans: Inter-company loans can help manage profits and cash flow, but ensure all transactions are official and documented with your accountant to comply with tax laws.
Setting up a loan between companies can be a useful financial strategy for property investors. By borrowing from one company and repaying it back to the other, you can manage your profits and cash flow. However, it's crucial to ensure all transactions are official and documented, with your accountant involved to ensure compliance with tax laws. For more information, check out the Property Hub's course on this topic at propertyhub.net/courses. Additionally, attending the Property Hub Summit is another great resource for investors to connect with like-minded individuals and discuss high-level property investing strategies, regardless of portfolio size. The next summit is coming up soon, so keep an eye on propertyhub.net/propertyadvice for details.
Create a personalized action plan and network at the Property Hub Summit: Attend the Property Hub Summit to receive practical steps, network, and continue learning through ongoing support and masterminding with peers.
The Property Hub Summit offers a unique opportunity for individuals at any stage of their property investing journey to create a personalized action plan, network with like-minded individuals, and receive ongoing support and accountability. By texting "summit then a space, and your email address" to "triple 802," you can learn more about attending the next summit in 2016. This event goes beyond typical property investing discussions, providing attendees with practical steps to overcome obstacles and achieve their goals. After the summit, participants can continue to learn and grow through networking and masterminding with their peers. The Property Hub also provides weekly podcasts and detailed show notes for those who want to delve deeper into property investing topics. Overall, the Property Hub Summit provides a valuable resource for individuals looking to build a solid foundation in property investing and take their first steps towards financial freedom.
ASK11: What’s the best company tax strategy?
Recent Episodes from The Property Podcast
TPP601: Renters’ Rights news: Has property just changed forever?
ASK446: Does this certificate mean I can't sell my flat? PLUS: My property is losing money, what can I do?
TPP600: September Market Update
ASK445: How do I convert growth into cash? PLUS: Can I get my lender to recognise improvements I've made?
AOB: How 5% extra effort can double your results
TPP599: What would we do if we started again?
ASK444: Is this Labour rumour true? PLUS: Does my refinancing plan work?
TPP598: Is property the ultimate investment for our new economic era?
ASK443: How do I convince my husband to invest? PLUS: What should I do when I move abroad?
TPP597: How often do property prices double? (Surprising data)
Related Episodes
TPP209 What does the Spring 2017 budget mean for property investors
The teams at RMP and Yellow have both grown in this past week. RMP have said hello to Julia and Christa, and Yellow have welcomed Donna and Nicole. So that's been a pretty busy week for us all round really!
We've also been creating some more free courses this week. Check out the ones that are there already here, and look out for a brand new course in the next few weeks.
News story: World's fastest hover train could go from Liverpool to Manchester in 7 minutes.
The Robs could not be more excited about this, even if it does seem quite a long way off right now. It combines some of our favourite cities to invest in, plus trains (and we all know how much Rob B like's trains!). So this is probably one of the most exciting news stories they've seen in a while.
Check out more about the potential Maglev train here.
The Spring Budget
This is a mini-budget, if you will. We've had to dig pretty deep to find something to say on this as The Chancellor did not mention housing at all. Here's a brief summary of points you might want to note though.
- Nothing about mortgage relief or stamp duty...in fact, nothing about housing at all!
- As before – Corporation tax will fall to 19% this April, and will then fall to 17% in April 2020. So good for those holding properties in a company
- The tax free dividend allowance for company directors will be reduced from £5K to £2K from April 2018.
- Extension until 2019 until landlords need to keep digital records and send quarterly updates to HMRC
- Rent-a-room relief – The government will consult on proposals to redesign rent-a-room relief, to ensure it is better targeted to support longer-term lettings. This will align the relief more closely with its intended purpose, to increase supply of affordable long-term lodgings.
And from the makers of The Northern Powerhouse...
Did you enjoy the Northern Powerhouse...then you’ll love the Midlands Engine! We don't have much to say on this right now, but watch this space.
Resource of the week
A lack-lustre budget but to make up for this we have not one but two resources of the week!
Managing your credit file is not exciting, but it is important. It's good to checkout a regular snapshot of how things are doing. The first resource this week is from Money Saving Expert and is called Credit Club. It's super useful and once you're signed up they will do the rest.
You can also get a free score from Experian now. This used to be around £15 per month, so is well worth checking out.
Continue the conversation over in the forum
What did you think to The Budget? Did you get as ridiculously excited over the prospect of the hover train, as Rob B did? Let us know over in the forum.
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118 Pent-Up, Flat-line, or Decrease: Anticipating 2021 Demand for Your Advisory Clients
Today I share with you a way of looking at 2021 on your clients’ behalf.
While exactly predicting the future is difficult, the year can be broken down into 3 main phases: hunkered-down, re-opening, and post-Covid. We are likely to be hunkered down through April, then May - September we will see continued business growth as things reopen, then September and beyond as we reach herd immunity, we will find our new post-Covid-normal.
Helping your clients consider these 3 phases and anticipate demand in their businesses can set them up to avoid a crash, or take advantage of a wave of interest.
Four main groups of businesses
There also exist 4 main groups of businesses.
Those who:
- experienced significant growth in 2021 (plexiglass and cleaning suppliers, funeral homes, software that facilitated work-from-home)
- had steady or minimally impacted (professional services, construction, and businesses that were essential or could operate in a Covid-safe way)
- suffered, but are managing to hang on, if only barely (physical therapists, chiropractors, salons, commercial real estate)
- Got walloped (local restaurants, gyms, travel related, anything conference related)
Putting your clients into these different groupings can help them think about how they might be affected in each phase.
Help Your Clients Anticipate Demand
For example:
What should the plexiglass supplier be anticipating for demand in 2021? How about the funeral home - at what point will demand dial down? How should one staff appropriately through each phase?
What should the physical therapist anticipate in terms of demand - if they laid off staff, when should they think about ramping back up? Given that hiring takes time (up to 8 weeks!) when should they begin the hiring process so as not to miss the wave of pent-up demand? If they wait for demand to ramp up to begin hiring, they will be unable to take full advantage of business demand.
For the salon owner: when will demand peak, and how to be best prepared?
Does the restaurant owner need to restock wine inventory?
When should the yoga studio owner begin adding more classes to the calendar?
If you cannot be an expert, at least be a guide
You don’t have to have the answer to all of these questions. Give these questions a few minutes of your attention before your next meeting with them, and address them together with your client, to add significant value.
This is where you earn the title Trusted Advisor.
Want structure for conversations with clients?
Download the 4x3 grid tool here, Anticipate 2021 for Your Clients
///////
Free 5-day email course - Better Pricing Strategies for CPAs
Upcoming training:
How Should I Price __X__ ?
Thursday, January 14th, 12pm ET
Free, register here: https://shethinksbigcoaching.com/free-stuff/
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https://shethinksbigcoaching.com/download-double-your-revenue
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APN Headlines - Read by Todd Sloan 05/01/2024
What's happening in property investing news this week in Australia?
It's time to find out!
We remove all the fluff to bring a neatly packaged news show, designed to keep you on the ball as an Australian Property Investor.
Let's see what's making property news headlines this week in Australia.
🍕🏠 We want to hear your investor story! So if you've experienced something that you know other investors can learn a thing or two from, click the link below and let us know. 🍕🏠
👉 pizzaandproperty.mykajabi.com/investorstory 👈
If you'd like to be flown into the Pizza & Property Studio, put up for a night's accommodation, have dinner with Todd Sloan, and have a team of carefully chosen property investing experts help you get unstuck, click the link below and tell us why you're stuck, and you could be our next UN-Stuck Yourself winner!
👉👉 pizzaandproperty.mykajabi.com/UnstuckYourself 👈👈
Support our amazing show sponsors:
Suburbs Finder:
Click the link below for your 15% off code if you want to sign up and research like a pro: https://www.suburbsfinder.com.au/pizza-and-property/
Story 1:
WA government introduces $300,000 interest-free loans to help builders finish homes
By Claire Moodie from ABCNews:
Link: https://www.abc.net.au/news/2024-01-04/wa-building-companies-300000-loans-finish-homes/103284942
Story 2:
Clean up continues in Far North Queensland after heavy flooding destroys homes
by SBS News:
Story 3:
Australian property values rose 8.1 per cent in 2023.
By Hanan Dervisevic from the ABC writes:
Link: https://www.abc.net.au/news/2024-01-03/housing-market-year-in-review-2023/103224452
Want more help understanding how to buy property faster and for less? Get your copy of Todd Sloan’s book today:
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Disclaimer: All discussions are general in nature and should never be considered financial advice, please seek your own professional financial advice. The content displayed on the website, podcast, and blog is the intellectual property of the Pizza and Property. You may not reuse, republish, or reprint such content without our written consent.
#18 - Unlocking The Hidden Truths Of Time Management
Have you ever felt like you're racing against the clock? Like you're trying to do a million things, but there just isn't enough time? It happens to most of us.
Think about the last time you had a loooong list of things to do. Did you ever wonder why it felt so overwhelming even before you got started? Is there more to it than just having lots of things to do?
Sometimes, we try to make everything absolutely perfect, spending tons of time on tiny details. Or on the other hand, we might procrastinate and then beat ourselves up afterward. Do any of those sound familiar?
And how about this: your schedule is jam-packed with things to do, but you still can't get it all done in a day. Ever felt that way?
If you can relate, this episode is for you!
In this episode, I discuss:
- Hidden Truth #1 - The Power of Simplification.
- Hidden Truth #2 - Managing Perfectionism.
- Hidden Truth #3 - Embracing Realistic Time Management.
- The Smarter Accountant Way: Managing Your Brain For Better Time Management.
Tune in to The Smarter Accountant Podcast today and join the discussion unlocking the hidden truths of better time management.
You can read the full show notes HERE.
If you're ready to become a Smarter Accountant, you can take The Smarter Accountant Quiz HERE.
125 - How Catherine Overcame Avoiding Fee Disclosure with Clients
Today we are talking to Catherine Thomas-Humphreys who is a Financial Advisor and who has just graduated from our Certified Financial Coaching program. It was interesting to talk about the difference between giving financial advice and financial coaching with the impact that both have on society. Catherine shared how she overcame awkward conversations around fee disclosure with her clients by the journey she took in becoming a financial coach.
In this episode:
- The personal emotional impact and journey in becoming a financial coach
- Passion around bringing honesty and transparency into the financial industry
- Dread around discussing fees with clients
- How low self-worth made Catherine feel like she should be over-giving and under charging
- Financial coaching is helping to better serve clients and have better money conversations
- The power of community
- Giving back to young mums
Resources:
Secure your spot on our FREE Financial Coaching Masterclass
Book in a complimentary call to discuss how financial coaching can help you move from financial overwhelm to confidence and control.
Join Catherine’s Facebook Page and FREE Facebook Group
My Online Courses – Investing for beginners from £1
Connect with me on Twitter, Instagram and Facebook
To work with Catherine Thomas-Humphreys contact her through her website or on Instagram