Grow Capital First

I now have 2, its complicated, just started a business I already new/heard about him, he is a league above.

 

I am in desperate need for a new accountant, the moment our business passed the small business threshold, I started to notice major problems with my accountant..

Would love to find out more

 

I'm doing this on a much smaller scale than you, but largely buying in NZ and using tax advantages to build a bigger portfolio. I've had some nice gains on Aus ips though so weighing up tax residency and how to use it to best advantage.

 

All makes sense then, that's an absurdly particular category to be able to squeeze into so well done, it's the glorious legal tax evasion category basically where you get to have your cake and eat it to. Well played!

Have tried to use that exemption a few times but have never had anyone who could meet all the criteria to do it because of how insanely specific it is! Have seen several where the wife disqualified them, another couple that managed to be in the protected SCV category and another few who just had permanent visas (non-NZ) instead.

Again, kudos on knowing that you manage to fit into that category and exploiting the living hell out of it with your investments!

 

That is correct if a temporary tax resident is married or co habitates with an Australian resident then this category will not apply ...back to the worldwide tax on all income....i used PWC to check this out in 2006 ..just after the 2006 tax legislation

 

How long have you been investing Beano?

 

Yeah, it's absurdly specific the criteria, can't have been in Australia on the date in 2001 (iirc) where they made changes to the SCV or have been here for 12 of the previous 24 months either. Very difficult but exceptional loophole group to fall into essentially! As I said, it's basically the tax equivalent of having ones cake and eating it to

 

Well i started at age 11 but only term deposits . Shares at 14 but properties at 19 (i was turned down for property loans before then. ..as i was still at school and uni).
Only lost money in residential
YIELD too low ...repairs gobbled up all my wages it was only in 1993 when I switched to commercial that the $$$ started coming in (if you look on the government accounts from 1993 you will see my contributions lol ...started to pay taxes on my investments 1993 still going strong! ..i stole this saying from Johnnie Walker Born 1820 still going strong haha)

 

Yeah i was working in 2006 saw the tax legislation (effective 1 july 2006) it looked fanastic (for us NZer)
I worked out my prospective tax savings alone in 2007 and onwards was going to exceed my net salary (i was on $150k then )
It was a no brainer

 

What is the yield you get on your commercial properties?

 

After a year of delivering and selling newspapers at primary school my term deposit interest equaled my after school jobs..but that's not real investing lol

 

On cost the highest 25% (1998)on the lowest (April 2016) 6.5% ...all net

 

The difference can be pretty large
If my last investment was made in Australia rather than NZ i would have had to pay an extra $1m (in stamp duty and land tax) before my $ of profit!

 

ouch...and double ouch

 

Can growing capital be achieved by subdivision as you are essentially getting land cheap?

Then cashflow obtained by building Duplex's on said subdivision?

This looks to be the formula I want to pursue to potentially achieve financial freedom.

 

It's a good strategy, maximising the use of the land, you can make profits and you can use this strategy to increase capital and cashflow, achieve both

Plenty of posts on strategies/developments,
I have posted my 4 townhouse Melbourne development (Thomastown) with the numbers

There are other threads, Parramatta duplex thread
(Under development section)

Baulkham hills deve thread

Just search if interested

 

Thanks MTR, have been reading most of those you've suggested already

 

Bump
After reading Jack Chen's journey, retired at 32 years old, I thought a good idea to bring this old thread back to life.....

Grow Capital First.... this is what got Jack to the end goal in a short time frame......

 

Yes you need to buy with growth in mind always, but 2 or 3 negative cash flow properties could leave you unable to move forward unless you have very deep pockets. It's not even a given you'll get sufficient growth to compensate for holding costs. I wouldn't be buying for cash flow, unless it was phenomenal in a town with 5k population. I'd be looking for cash flow in large towns or cities with 100 k pop or better. You may need to look interstate or international or for ways to improve cash flow, maybe adding a bedroom etc. Balance.

Anyone got examples of cash flow properties with great growth or negative geared properties that didn't produce great growth or cash flow? I bought a couple of IPs last year with 6.5% net yield and each had paper gains of 20% over the year. Not in capital cities. They could stay flat for a few years now, dip or have continuing steady growth. Either way they give me options.

 

Yes, catch 22 though

Developing property is one way

All my properties in US have experienced massive growth and are all cashflow positive


In Oz Only way I can achieve this - cashflow and growth is by developing, build 3, sell one or two depends and achieve both cash flow/growth

Also, granny flat at rear, this works but need to be selective on suburb/State