Genghis Khan wrote:Cde Monomotapa wrote:Gordon Gekko wrote:african coloner wrote:why invest 10m for 100k a month, surely there must be other ways you can earn that with less capital
That is a 12% return. (ksh 100K * 12)/ksh 10M. Which investment can beat that for such a passive and low risk investment?
Less how much in rates & taxes(30%)? We are talking strictly income without capital gains/losses upon sale in both asset classes.
Why would you pay 30%?
WWGKD?
1. I would build the damn thing for 10m in a company name. The assumption here is that i had 10m in cash. I wouldn't get a bank loan @ 14%plus for such a project.
2. I would sell my car for 1.5m. I would then buy a company car for a similar amount and let the "employees/tenants" work to make the repayments. I would also get a post paid fuel card, and charge the company for any service, insurance etc.
3. If this is not yet 100k, I would find yet another way of expensing the income before KRA gets to it.
4. Every cent of the company money I spend, I invest (from my other income). It can be in the same company as "new capital from shareholders" or just in my personal CDS / savings account doesn't really matter as long as I DON'T spend it as well.
You can pay as low a tax as you are smart, just be careful to do it LEGALLY, consult a lawyer if u have to. KRA guys are not kind to smart people.
The Principal here is to spend and invest before you are taxed.
Companies pay taxes on profits (Income less expense), natural persons pay taxes on Gross Income. All tax systems are flawed this way.
The taxman will audit you but all you have to do is justify the expenses.
You can even buy airtime before paying taxes if u are smart enough.
Even booze for "clients"...
The only substantial amount of money i make in my own name is my salo which is taxed at source
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