Hi All,

Think of to setup a company with a friend with partnership. Option can be Sdn. Bhd. or Enterprise.

Is this feasible or advantages ? Any one doing this can share ? Let discuss.

hi, invest2229,

How does it work? Is it you mean real estate business by finding for purchaser and seller.

I am working in a law firm and wanted to get involve into it.

No, we are not the real estate business. Company objective is to buy the property and then rent it out. The monthly rental will then bank into company bank account. Secondly, when the price of the property appreciated, then the company will consider to sell it.

We are not helping customer to sell or rent.

If you company sells those property after making money, your company will still be taxed 20% (small Sdn Bhd) on the profit and there's no exemption on RPGT.
Becareful of hidden charges of Sdn Bhd.. secretarial fee, accounting fee, auditing fee etc...

Tax 20% ??!! If profit 100k, taxed 20k ?

Why you mentioned small sdn bhd ?

How normally people form such company for property investment ? Is there any other good method ?

For profit lower than RM500k p.a., the tax rate is only 20% flat. Anything higher taxed at normal corperate rate.
Your profit from buy and sell property will be considered income. I am not a tax expert, but my accountant vaguely said if income above 150k, then suggest to form Sdn Bhd. But just remember u have to pay for secretarial, auditor, account etc.. which may come up to be a few k a year.

The company income from the property investment can be from rental return and selling the property. Selling
property will be after 5 years.

If take example of rental income. If got 5 properties, and each rental collection is RM1000 per months. Mean, monthly
will be RM5000. If calculate by yearly, it just about RM60000. And assume monthly bank installment is RM800 for
each, mean RM800 x 5 = RM4000. If for tax subject mater, how much the company will be taxed ? (Assume that, each property with bank loan, mean monthly still need to pay for monthly installment.)

Ya, understand that Sdn Bhd, need to pay for secretarial for RM80/month. What if within 1 year, the company
not make any business. Do I still need to pay this secretarial, auditor or accountant fee ?

agree with you newbie99.

you are right about hidden charges.

Invest2229: 1) I think the company need alot of cash or property to gadai in order to run this business from what my understanding.
2) to answer ur question, you still need to pay audit fees, sectarial fees and other possible fees.

Good Discusion anyway.

TS, the reason why people use company to purchase property is because they have too much property to hold in personal name. Hence, they move it to a s/b to safeguard it. They usually use the name "ABC Holdings s/b". Whereby all the property are under the ABC holdings, and manage the properties rental, expenses, and everything. If you do not have more than 5 properties at hand, it is not worth for you to do so. Considering the taxes alone, you will kena gao gao.

Can I know about how much yearly cost for secretarial fee, accounting fee & auditing fee ?

Around RM 2k-2.5k.

Thanks.

Base on my understanding from you guys was, if too little investment/income is not worth to setup company to
manage the property.

Partnership with a friend also as one of the reason to setup company to handle property investment. All transactions of buy/sell and rental income will be recorded under company. Any other better way to manage with partnership with friend for property investment ?

Yes. Correct.

Having a S/B or enterprise is the best way. Or you can just have a simple agreement regarding the profit derive from the said property and how to split between you two.

if the properties is under my name n what is the cost to transfer into the company?? the title hav to transfer the name tinto company name??lawyer charges same with spa?

Please only seek advice from people who use company to invest in property. There is a different tax law involve.

Sell the property to your company. If you sell the title to the company, of course the title owner will also change to your company.

I'm using company to hold my land and commercial property.

Ermmm I'm quite interested

AFAIK, the nett profit is taxed after all company expense. So better use the money in the company's name to get minimal taxing.

sell own property to ownself company?with SPA　Stamp duties will be a big amount let's say 3-5m of properties.

Invest2229,

U might find this resource a useful head's up before setting up an asset holding company.

http://www.iproperty.com.my/news/2292/Shou...stment-Property?

Enjoy.

Darly Teo,

Good information and God Bless You.

Thanks dude. Have a blessed week.

Your advise can listen lah.

By the way, companies can pay 0% tax even it is earning money.

wow.... how?!

Bro.. How much capital you intend to put up for your company to purchase property? To begin with your company can't take any mortgages from bank as your company what account or audit report also don't have. Bank unable to derive your income to grant you a mortgage.

Normally, only those who run company more than a year able to get mortgage easily to buy property under company name. If you're thinking of setting up company jst to deal with rental, might as well purchase the property with your partner then open a joint account to bank in rental. End of story. Few thousands rental a month as income, tax don't declare also nevermind. =)

My property company was injected with 400k to purchase property. I first started out with few properties without using company, and over the years after making money out of it, I inject some of my investment return into the property company.

Whether or not it is rental, the purpose to setup a company to hold properties is because one has too much property to hold under one name. And it is better to let the company hold the liabilities than having personal name on it.

Company set up with the sole intension of property investment for rental even with RM2.00 paid up can get loan with T&C much like individual. The rational is that the director/ shareholder is the guarantor for the loan. This is confirmed and practised by some property investors. But in order to off-set the inherent cost of setting up & maintainence of a Sdn. Bhd., the monthly rental must reach a certain amt. (RM30k per annum?)

For rental income, even afew hundred per month oso gotta declare else it is tax evasion. Of course you can also off-set against your maintainece cost & repairs in order to minimize the taxable amount but still need to declare.

Don't look into this option if you are not making RM15k per month through rental.

I am planning to keep and build it a company once stable (reaching the income).

2ndly, I am in the mid of obtaining a license to setup a real estate company, whereby I can managed, sell, buy a location.