Many thanks for the information and this is what I wondered. Although I wish we could write-off a Porsche we are thinking more of her home office/studio and her SUV plus other expenses.

 

It's like a friend of mine with an Audi who wanted to buy her lease out and I start warning her on what maintenance costs are down the road and why Audi's are designed so that the company doesn't have high maintenance costs within this four year period and then *suddenly* you will notice that all the heavy maintenance costs (you should change this/replace that/do this) appear in year five and after 80K mileage and up when you own it.

I warned her...

Then year five hits after she took the buyout and all of a sudden shes horrified at a bill to replace the rubber booties on the four drive shaft links (don't know what Audi call them - I call then CV booties) I'm a good friend so I don't say 'I told you so'. But it is just the beginning... and why there are so many A4's on Autotraders after the warranties are up. Same with BMW.

Wrenching on new cars is crazy now and that's with people with basic skills. Forget about people where changing a headlight bulb is rocket science.

It's going to be interesting to see what happens to the 991 and 991 GT3/Turbo cars in the future that have all this new technology such as Hybrid equipment, rear steer, electronic everything. When you have to factor in your after warranty period maintenance it will almost look like your monthly car payments never really stopped after you thought you paid the car off.

I can see the time in the future where car manufacturers develop a new type of warranty program such as furnace companies offer where you pay monthly maintenance fees on cars out of warranties - say $350 per month in order to qualify for a maintenance/failure program based upon an annual at your cost check up.

Its going to happen at some point as without it - it will just kill off the value of these used cars in the future when people wise up to the cost of repairs/ maintenance when a 991 hits six or seven years old and an annual maintenance bill est comes in at 20% of the cars depreciated value.

People will look back 10 years from now and think 996's were good deals.

 

Interesting that you say this...

My MBA group is working on our Thesis for a car manufacturer (name withheld due to confidentiality reasons) and this very same service model and others similar to it are "interests" they have us looking at.

 

if incorporated business as long as the net income is under 500k the company income tax is 18%.

Cam, dont forget that if your wifes inc. business pays for legitimate expenses such as
- phone
- gas
- car
- reasonable amount of meals
- gear
- home office studio/office construction (to reasonable amounts)
- monthly rent/utilities (ie. internet portion of electricity maybe even small amounts of food/coffee magazine subscriptions if potential clients are over).
- etc etc

to the point that she doesnt need to draw a salary she can take a single annual tax free dividend of 36 grand (plus i believe a 400$ fee). that coupled with the fact that her inc. company income tax rate is 18% you should come out on top taxwise vs being a sole propriter. the general rule is that her business needs to make about 85-100k a year to make the inc. switch over worthwhile (for a small single person business).

make sure she has enough to cover a hst payout as i see that bite serviced based industries in the a$$ come tax time.

re cars, you can write off max 800+ hst a month for a car lease , plus reasonable car related expenses like car washes and what not; but its never over 10 grand a year. if you end up leasing a 911 for 1600 a month thru the business 800 can be written off against income while the other 800 her company will pretty much just eat without any tax savings..... and like quest911 stated if her income is too low it could get you flagged for an audit. ive seen it happen.

if you already own your cars (ie. the suv your wife drives) your wifes company can pay her a reasonable car allowance (ie. ~500$) a month. imo i would go this route vs having her company lease/finance a car directly. for me, at the very least i purchase the car through my business so that when i feel the car isnt depreciating enough (for write off purposes) i can sell it to my parents if they need a car for cheap since i still own the car outright vs paying to it (lease) , but thats just me.

feel free to call me about any of this stuff, hopefully it wasnt too confusing.

 

i couldn't agree more brothers!

and while it can be argued, homes actually have a chance to increase/maintain value.... cars that are driven on the other hand only go DOWN.

3 grand a month is 50% more then what i pay for my monthly mortgage... too rich for my blood.

 

paycheck to paycheck, leasing is the cheapest way to get into a nice car. fake it till you make it i hear.

 

I thought it was 15.5% up to $500,000 and 18% over. No tax on capital gains up to $500,000 and none on capital gains on primary residence.

 

i stand corrected sir!

i was quoting 18% re 2010 figures (right before i incorporated my business)

http://www.cra-arc.gc.ca/tx/bsnss/tp...s/rts-eng.html

 

I think it's about to change back anyway... :-(

 

Capital gains lifetime exemption is 750k and then at 50% and no capital gains or principal residence

 

Ouch. Good to know.