Buying a PPOR for Family Day Care?

Discussion in 'What to buy' started by hammer, 31st Oct, 2015.

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  1. hammer

    hammer Well-Known Member

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    I was wondering if I could run a potential strategy by all the amazing minds in here...

    My wife is thinking about opening a family day care from home. We need a place of our own anyway, so I figure we could buy a double storey house, put the business downstairs and live upstairs.

    Does this sound like a financially smart move? I understand that we'd miss out on half the CGT exemption...but then again (in theory) it would mean that half of our PPOR debt would become tax deductible.

    Not expecting rocketing growth in Darwin for a long while so am thinking the CGT exemption loss might be more than made up for by the deductible interest repayments.

    This isn't all about the money - Running a business from home would make my wife very happy, and she's damn good at what she does.

    Thoughts?
     
    hammer, 31st Oct, 2015
    #1
  2. Jess Peletier

    Jess Peletier Mortgage Broker & Finance Strategy, Aus Wide! Business Member

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    In theory it sounds great - I love working from home.

    Just check with council to make sure they're happy with it first.
     
    Jess Peletier, 31st Oct, 2015
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  3. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    Day care is potentially very risky. So having all your eggs in the same basket will result in all assets being at risk in the event that a child injures themselves - occupiers liability.
     
    Terry_w, 31st Oct, 2015
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  4. hammer

    hammer Well-Known Member

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    Wouldn't insurance cover all of that? Also it is my understanding that you run family day care in conjunction with a third party organisation which have their own insurances etc for this very reason. Still you make a damn good point will be researching further....
     
    hammer, 31st Oct, 2015
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  5. Bran

    Bran Well-Known Member

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    I'm thinking the same with an old PPOR, now IP that looks like it was built to be a day care centre.

    Keep us posted
     
    Bran, 31st Oct, 2015
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  6. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    No insurance would not cover every eventuality. Glass could be broken and it later turn out that the glass was not up to standard etc etc.
     
    Terry_w, 31st Oct, 2015
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  7. Gingin

    Gingin Well-Known Member

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    In nsw my rental place is let to a couple who live there and conduct this business. Some extra workers come in the morning along with the kids for the required ratio. It seems to work well for them. It is above board and they love it.

    Before they were allowed kids it was audited by the childcare company and safety switches ,gates and fences installed.
     
    Gingin, 5th Nov, 2015
    #7
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