How can I purchase my own business premises?
With a Commercial Property Loan.
Some businesses choose to buy rather than rent their business premises. To do this, they take out a Commercial Property Loan.
Commercial Property Loan Repayments - effect on cash flow
Many small businesses prefer to rent rather than buy for cash flow reasons. However, there are a number of factors that can make buying your business premises an attractive option.
Commercial Property - Self-Managed Super Funds
Many businesses these days have their own Self-Managed Super Funds. Rather than invest in a share or property trust, some of these businesses choose to invest their Super Funds in their own Commercial Property.
Commercial Property - interest is tax deductible
If the property financed by a Commercial Property loan is used entirely for business purposes, the interest charges on the loan are wholly tax deductible - as are any maintenance charges. If the property is partially used for personal purposes, only a commensurate proportion of your interest and maintenance charges is tax deductible.
Your Commercial Property could make a capital gain
Over recent years, property prices have appreciated markedly. If this trend continues, you might make a Capital Gain on your Commercial Property. To learn more about Commercial Property Loans, contact an MFAA member today.
Want another Business Finance tip?
Cash Flow: Car Leasing, Equipment Leasing. Check out Essential #34.