Pros and Cons of constructing a house using a management company

This is a hypothetical question to the experts.

If I buy a new land in my name and I or my spouse build a house using my/spouse?s management company, can the company claim GST credits and charge wages etc. The company would be borrowing services of a builder and various services to construct home.

I trying to see, if we can bring down the costs of construction with this set-up. The house will eventually for investments.
 
It's residential, the total cost is gst inclusive so it makes no difference as the management company will have to pass the gst on to the client.
 
This is a hypothetical question to the experts.

If I buy a new land in my name and I or my spouse build a house using my/spouse?s management company, can the company claim GST credits and charge wages etc. The company would be borrowing services of a builder and various services to construct home.

I trying to see, if we can bring down the costs of construction with this set-up. The house will eventually for investments.

Not a hypothetical response. Its all facts.

- Only an enterprise that is registered for GST can claim the tax credits.
- A passive investor cannot claim input tax credits on a resi build
- A developer might be able to claim the tax credits on the build and it doesn't matter if they are individual, individuals, company, trust...Its that old "revenue"issue.
- If the owner of land intends to immediately sell the construct then the GST can be claimed progressively. Otherwise its claimed at the end when sold as a reduction in the 1/11th GST on the sale.

This is a complex area and personal tax advice is needed.

In almost every instance a passive rental investor cannot claim ANY GST on any expenses. This is because resi rent is input taxed. That means the GST on inputs is denied but the rent is GST free. On a typical invest prop there is very little GST - Repairs, agent fees,...NOt much more. No GST on rates, water etc.
 
One of the quick thoughts that I have in mind is to reimburse $18,200 as salary for my non-working spouse. Thus banking future capital gain into tax free salary.
 
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