ABN: What Is It, Should You Get One and How Is It Used For Home Loans
If you’re going to become a self-employed person, you need to have an ABN (or Australian Business Number). If not, the companies you do business with can hold 46.5 percent of payments that you’re owed for tax reasons.
This number will also help you to attain a low-doc home or commercial loan. Thus, registering for one is extremely important.
What is an ABN?
It’s actually a unique 11-digit number that identifies your business and is used when interacting with customers, other companies and businesses. You’ll have to put the ABN number on sales-related documents and invoices. It also be used with governmental agencies like the Australian Tax Office (ATO). And, although it’s not necessary, you can use it to register for the GST.
Is getting an ABN worth it to you? If you want to start your own business, it’s certainly a requirement you shouldn’t overlook.
In What Others Ways Is The ABN Used?
- Simplify your business activity statement
- Claim energy grant credits
- Claim GST credits
- Purchase an Australian domain name
- Avoid pay-as-you-go tax instalments on monies you receive
How Can You Apply For The ABN?
You have three options in which to apply for your ABN
- Fill out an online application on the Australian Business Register website
- Paper applications documents can be downloaded through the ATO website
- Tax agent who can complete the application for you online
Make sure that you fill the information out as clearly and correctly as you can. Mistakes, whether accidental or on purpose, can cost you severely. If you falsify information, you could get hit with a $10,000 fine. A mistake on the ABN application could cost you more than $3,000.
How Self-Employed People Can Get Low Doc Loans For Their Home Purchase
Self-employed people have an array of benefits when it comes to using low doc loans to effectively finance their home purchase. However, there are some common misconceptions that go along with self-employed finance.
Low Doc Loans: What Are They?
In simple terms, low doc loans are an easier mortgage finance answer to people who run their own business. These borrowers have the income and assets but cannot give the necessary tax returns or financial statements when due at application time. These loans are generally granted on the basis the applicant self-declares their business income. It’s called a self-certification of income or low doc declaration.
Why Should You Use A Low Doc Loan?
The majority of self-employed people are often too busy and constantly running around and trying to grow their business – than to deal with the financial paperwork necessary for a loan. A good number of business owners have good cash flow and assets to justify getting the money, but they don’t have current paperwork such as financial statements and tax returns that demonstrate their present financial standing.
In many cases, people who are in business for themselves have fairly complex financial affairs that are geared at decreasing their tax standing. For them, it’s generally much easier for them to attain a low doc home loan.
If you are self-employed then low doc loans may be the solution you are looking for to secure finance. Contact one of our Specialist Lending Managers to discuss your low doc lending options.