The Background

  • Doctor – Aged 45, Married, 2 Kids
  • Sole Trader with profits of €150,000 – €200,000
  • Recently purchased a new home, purchase price €1 million – Loan of €750,000
  • Owns a practice premises on the High Street, prime location, value of €1+ million, which includes a small site with potential for an apartment, in own name with no borrowing

The Issues:

  • Very large homeloan
  • Not utilising significant commercial practice premises
  • Cannot pay self rent for property he owns

The Solutions:

  • Split portfolio between practice and site
  • Sold property to his wife for €700,000
  • No Capital Gains Tax or Stamp Duty
  • Now charges rent to practice
  • Created tax offset for practice
  • Took out large portion €300,000 off homeloan and removed short term loans
  • €300,000+ remaining tax free money for investment purposes
  • Diversified from property into managed funds

The Alternative solution:

  • To repay loan on a pension backed mortgage basis