That is bad advice from your accountant. The nature of the deal/enterprise is what affects whether gst is payable or not, profit levels are irrelevant. Imagine if you developed 200 apartments in the city but due to market conditions you only broke even. Gst would absolutely be payable on the sale.
The 75K gst threshold refers to turnover for a business, once it turns over more than 75K it has to be registered for gst.
Yep, got it, perhaps I have got is mixed up not surprising. I am catching up with him over the next couple of month, so much fun.... not.... financial year. Anyway, I am going to be asking lots of questions and post back.
So your end position will be loan of about $1mil. By my sums you are not putting any additional cash into the deal now (maybe just a little bit).
Interest on $1mil is about $55k/pa.
Add in a few costs (mgt, rates etc) youre up to total costs of $65k.
at $450pwx3 income of about $70k. So basically cf neutral/slightly positive.
You can draw up to 80% thus providing $200k (or $350k at 90%) for the next project.
On further investigation, there may be something in this.
What are the forum rules here? am I allowed to change my opinion? or must I stead-fastly hold on to it, even when proven wrong by the more experienced/smarter? Mods - help
We went ahead with two retain and builds in thornlie a couple of years ago. At the time the numbers didn't really stack up but we did it anyway mainly for the experience. However for us the risk was low because the front houses could stay rented the whole time. Luckily the market has moved a bit since then and we've ended up with more equity than expected.
on completion i'd get it revalued and release the available equity into an LOC and wait for an opportunity.
On further investigation, there may be something in this.
What are the forum rules here? am I allowed to change my opinion? or must I stead-fastly hold on to it, even when proven wrong by the more experienced/smarter? Mods - help