Company Loan Payback V Taxable Income

Good evening everyone

I have lent my company $100,000 and plan to have the company repay me over this financial year (instead of being paid a wage which is taxable)

My aim is to purchase the commercial property I am leasing for 700k-800k in the next 1-2 years
My income for this financial year will be 100K which is the loan payback from the PTY

My question is - will this hinder my chances to get finance as I won't have a "taxable income" for this FY or is it irrelevant as its a commercial loan?

Thank you in advance

 

Depends

If you own the company and you are borrowing for the new purchase it won't affect serviceability at all, generally, because lenders will look at your income and the income of the company. This is the return of capital so it will not be income for servicing if the company pays it back.

 

A quality relationship manager or broker will manage the position either way.

I suggest you focus on achieving the best after tax outcome.

 

It shouldn't hinder your ability. Your company would no longer pay you a wage and that would increase your profit which you can use for servicing. The loan repayment is amortisation and not expensed in your P&L. It would show up on your statement of cashflows if you report it and be reflected in your balance sheet by a reduction in cash and removal of the loan in the liabilities.

 

Don't forget to charge your company interest on the money you lend it.