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Increasing income for future finance

Discussion in 'Property Finance' started by dabbler, 30th Aug, 2015.

  1. dabbler

    dabbler Well-Known Member

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    Hi All,

    I am posting this as I read conflicting things and have probably some advice that is not accurate.

    I now have a regular PAYG job, that I won't give up anytime soon most likely even though it is poor income wise.

    If I want to finance things into the future, I have to either lower my out goings or increase income, or both.

    I have a choice to make. I can get extra work in same area as now, however I would have to do as contractor OR I can start using some of my other skills and use an ABN to get extra income.

    Problem is, I have been lead to believe, unless income from ABN is a GST registered affair, the income wont be looked at or taken seriously, this would also seem to mean extra income, say from hobbies, would also not be able to be counted, nor would random extra income.

    I feel maybe some of the info I have been served, is for short term or in an instant situation, as time goes by however, if using one or any/all of these methods, surely it must count for something ?

    So

    What do you think would work best (I am looking at mainly increasing income, but I may also down the track move to a residences with lower outgoing)

    Do low doc loans no longer look at incomes that are from ABN that are not GST registered
     
  2. Azazel

    Azazel Well-Known Member

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  3. dabbler

    dabbler Well-Known Member

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    Yeah, ta, been reading that :)

    Wish I had that income problem :D, mine is different and is not existing income yet, did not want to hijack that thread.
     
  4. Azazel

    Azazel Well-Known Member

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    Nice one, plenty would ;)
    I'm sure some people will be along soon enough to answer specific questions.
     
  5. dabbler

    dabbler Well-Known Member

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    No takers on what would be best ? seems from some other posts the PAYG would be the only useful route ?
     
  6. tobe

    tobe Well-Known Member

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    PAYG income has the advantage it can be used immediately.

    I'm guessing your contract work doesn't get a payslip? (Some do) with an abn and business income you do need to be registered for gst if the turnover is more than $75k. You can choose to register anyway is my understanding.

    Either way, for a finance application, you can use that business income once it's in your tax return. Most lenders would actually prefer to see two years of tax returns.

    You may be able to find an exception to use this income earlier, if you have a contract and it's similar work that you perform payg.
     
  7. albanga

    albanga Well-Known Member

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    @tobe
    Say you have your normal PAYG of 100k and then a part-time business in a totally different industry which generates a net profit of say 15k a year (not registered for GST).
    How would the lenders usually assess this? Is it like being on 115k or would they look at it less favorably (if at all) due to being so small a profit and the fact it is in a different space to your PAYG which brings in the most income?
     
  8. tobe

    tobe Well-Known Member

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    Depends how it is presented, but most lenders would accept the income if the business part meets their guidelines (1 year or 2 years tax returns etc).

    Some lenders might exclude it if it's obvious the client is working more than 60 hours a week, or if they argue it's not something sustainable etc. being in a different industry per se won't be enough to exclude the income.
     
    albanga likes this.
  9. dabbler

    dabbler Well-Known Member

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    Hi Tobe, Alabanga, I had a reply drafted, but I have the answer now, maybe doing small business would be better as there will be no hours tied to the figures.