Online project puts cart before horse

Online project puts cart before horse I AM studying a diploma of commercial arts interior design and investigating registering my business name and setting up an online interiors store. I am paying off my house and I have a mortgage of $450,000. I AM a single, self-employed 45-year-old private business consultant working from my home office. My aim is to pay this off as soon as possible. To do this I need to withdraw substantial income from my business, resulting in substantial amounts of personal income tax. Setting up an online business is not as easy as it looks and there are also a lot of failures. Do you have an offset account where you park surplus income? If you don't, you should. You might want to take into account getting a job and setting up your online store as a part-time gig. On the facts you've given I'd say you're best not to borrow from the company, but rather to take your remuneration and make debt reductions from there. The last thing you'd like to do is put all your money into a small business with no real experience. What is the best way to minimise income tax and pay off my loan in a timely manner? I have been told there would be complexities in borrowing substantial amounts from my company to pay the mortgage. You will need to keep a journal of time spent in the house office. Regarding the house office, if you claim occupancy costs such as interest and rates, you do open it up to capital gains tax. I don't claim a full-time home office because I am concerned about paying capital gains tax on a proportion of the selling price when I eventually sell. Find a job which will teach you the basic skills you have to establish your own business and go from there. Also, are you making monthly, fortnightly or weekly loan repayments? More frequent repayments will reduce your mortgage much more quickly. Good luck. You can, however, claim operational costs such as phone, internet, power, heating and cooling, as well as depreciation on office equipment and furniture. The rule is to keep good records to make certain you are getting a deduction for all your legitimate business expenses. Online project puts cart before horse Trade News selected by Local Linkup on 10/04/2012