buying a business, any tax benefits?

[cloudyday]

Are there any tax benefits if one buys a business?

For example can you depreciate the cost of buying a business?? I would love to buy an existing business (e.g. cafe or newsagency) but my friend has told me that if I buy one say for $300k. I can't depreciate it it for tax purposes, like a house.

So does anybody know if hes wrong, right etc? Any tips?

 

[peastman]

The business equipment can be depreciated but not the goodwill. You would not want goodwill to depreciate anyway, the whole idea of business is to increase goodwill.
Owning a business does have many tax advantages depending on the business. You may already have many private expenses which could be made business expenses therefore deductable or portion thereof. Motor vehicle expenses, home office, insurances, etc.
Speak to your accountant, he/she knows all the ins and outs.

 

[craigb]

buying a business has a few positive features, it MIGHT give you a large income and cash flow, you may purchase the property and if the business pays your staff and out goings the property will/should capitalise . but it is not an easy ride , you weakends are gone your family time may suffer, and for up to three years perhaps. it will one way or the other change your life .
But you should not look at buying a business because of any tax benifits. try to concerntrate on one day having to be able to pay 1 million dollers in tax instead?

 

[klublok]

Shouldn't you be concentrating on whether the business makes money first and how sustainable that income is?

 

[jaycee]

He probably has considered that. But the conversation with his friend was focussing more on deductions for a buisness or an ip.

If the business idea fits in with your lifestyle and what you want to do (learn about this if you don't really know). my "guess" is the business would win