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Business Finance #3:

Q: How can I purchase my own business premises?

A: 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 #04.