Home – New Forums Money matters Busines loan to myself tax break question ..

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  • #972343
    Froger
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    G’day all great site ..
    I have recently bought myself a cleaning business in my area an as with all small business owners have no time to scratch myself anymore ..
    My question is , I paid for the business with my own cash that I had saved , am I able to get tax breaks the same way as if I had borrowed the money from an institution and if so could someone elaborate on which I can claim .. I’m also a sole trader not company …

    Much appreciate any feed back ..
    Thanks Fred ..

    #1055565
    Alan Maddick
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    Short answer no. As a sole trader you (the person who lent the money) and you (the business who borrowed the money) are both the same person.

    When you operate as a company or trust you can set up a formal loan agreement with yourself but it must be at arms length or commercial terms.

    #1055566
    Froger
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    Thanks very much for that ..
    Fred

    #1055567
    Chris R.
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    Just thinking, as time goes on and your business grows, you may want to check into leasing your equipment. From what I understand, equipment leasing can be helpful with managing cashflow and (I believe) offer tax breaks in certain situations.

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