Wednesday 11 April 2012

Rental Property Management

Owners of rental property in the Lower Mainland of British Columbia make use of our services. We provide full service property management to investors on a long term basis. The result is that many of our clients stay with us for decades.

Our primary service is rent collection. We will act as a rental agent to collect your tenant?s rent, pay repair bills, mortgages, strata payments/condo fees, property taxes, non-resident taxes, and any other payments that you instruct us to make. As a provincially licensed real estate company we maintain a trust account for clients funds in strict compliance with the Real Estate Services Act of British Columbia. A condition of licensing is a yearly audit for the Real Estate Council of British Columbia.

We generate monthly statements of account and send them by email or snail mail, along with copies of all receipts. We do not add handling charges to any disbursements. We also provide tax statements annually.

We can provide services to non-resident owners from around the globe. We currently manage property for clients from virtually every part of the world, including Africa, Asia, Europe, Australia and North America and South America. We transact business daily all over the world.

Non-resident investors who own Canadian rental property are required to send in 25% of gross income to the CRA each month. This status is an income tax status and is not an immigration or citizenship status. A Canadian citizen could be a non-resident for income tax purposes, as can a Permanent Resident or a citizen of a foreign country.

Its not too difficult to comply with the tax laws, but most people require professional help. It is critical to comply. If you don?t comply you will run into all sorts of problems in the future when you sell.

Non-compliant owners will face burdensome paperwork, as well as potentially crippling penalties and interest charges. The solution is to have a Canadian agent who is willing to sign an undertaking to remit taxes on behalf of the non-resident. Coronet Realty Ltd. provides this service.

Non-residents pay 25% of their rental income in tax, and must remit this monthly, but if you make use of our service you pay 25% of net rather than 25% of gross. This makes a huge difference to cash flow. Without an agent the owner of a cash flow neutral property will be required to contribute a monthly top up of 25% of the gross income and see that it is remitted to the CRA.

They would not recover that expense until they filed a tax return the following year. A negative cash flow property puts the non-resident without an agent in an even worse position. With an agent the tax bite is reduced to 25% of net. The net income of a cash flow neutral or cash flow negative property is zero, and 25% of zero is zero, so all that is done is paperwork.

Want to find out more about property management, then visit Oswaldo Taggart?s site on how to choose the best rental agent for your needs.

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