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Archive for January, 2010

Finance can be the most complicated thing in the world. Especially when you are not much interested in calculations, numbers, and similar things. It is a fact that some people take one look at numbers and freak out. They choose to leave it all to the financial advisors or accountants. But the fact is that understanding your own finances can be a very important thing, not to mention it can be rewarding and satisfying.

Self-Employed?

If you are self-employed or considering it, then finance is something that you will definitely come up against. Knowing how to manage money for a business no matter how small can save you a great deal. This isn’t only in money but in time and stress as well.

Many businesses need a start up loan, something to get them going so that it can have enough amounts to purchase essential things. Well, I don’t know about you but I don’t have a couple of thousand dollars sitting and doing nothing. If you want that money you will need to go get it.

Banks

One option is to seek a loan from a bank or some other financial institution. There is often a consultant whom you can speak to about getting a loan and many banks have a great deal of materials available for you to read. The most common requirement in order to get a loan is make a business plan. This is very important if you want the finance. There are many places you can find out about how to write a good business plan but an idle business person thoroughly studies and makes the plans himself/herself. In case you are doing some partnership business then your partner and you can decide upon this factor together.

Finance Investors

Investors are one of your options. There are many great books out there (not to mention a certain TV program) that show you how to pitch to investors. This is no easy task and can be quite scary. The important thing to remember is that you are trying to sell your business as an idea. You need to show them that you are going to make money and they will make money as well. To do this you need to know some basic finance terminologies.

Terminology

Like all professional fields the financial field as its own buzzwords and terminology that can completely confuse a ‘normal’ person. If you do not understand a term fully it is best to avoid using it because you think it is the right thing to do. You best bet is to buy a good phrase book based, which will contain all the things you will need, such as interest, capital, amortization, and many others.

Still Don’t Get It?

If after doing some research and trying it on your own it may be time to seek professional help in this area. Your other option is to enroll in a business finance program. This way you will learn how to do all the things you wanted as well as maybe finding a new career path. The choice is yours.

You recently bought a lot to build your dream house on and your plans are ready. Now it is time to start applying for a construction loan. The Bank Manager was very cooperative, both of you filled out the necessary papers to get things rolling. The Bank Manager said it would take several weeks for them to look at the plans and make up their mind if they will loan you the money for the Construction loan.

Building your own home is a lot smarter than buying a house that is in a Home Owners Association that is already built. The smart thing about building your own home is that you do not end up settling. You actually get everything you want in a home. If you buy a used home, the house has already been lived in. This is why people like to build their own home that has everything that you want and need. The positive side is, it is brand new and made just for you.

Credit is important when seeking a construction loan to build your own dream house. Bad credit can be a real disaster when seek financing. Banks and Mortgages Companies won’t trust you like they do their good customers. This can really put a damper on your plans. Because of this, you probably think that you will never be able to qualify for a construction loan. That’s actually not true. In fact, there banks that will provide bad credit financing for your home under special programs. The odds are you will pay a premium for the loan with possible restrictions, but the financing is possible. I did a search on Google, guess what, there were five firms that are willing to finance your new home financing. Your dream could come true and you will not to settle for that small apartment. You can build your own house for your family instead!

This type of financing can get complicated. They are not as simple as a regular mortgage. There are inspections on the as-builds that will be required by the banks or mortgage company. I remember when we built our first house. It took a month to get approval. Then we started by subcontracting out parts of the job. When we got to 50%, they would inspect and OK the release of additional funds. Then 80% and then 100%. It depends upon the lender. It is a great feeling to build what you want. Go for it if you feel comfortable.

In conclusion, getting a construction loan with a poor credit score is possible with the right lender. When the project is complete, there will be great satisfaction in what you have accomplished knowing that you built this house. Financing is a little more complicated than a regular mortgage and will require periodic inspections by the lender. If you feel comfortable building your own house, go for it.

The Business and Industry (B&I) loan program administered by the United States Department of Agriculture (USDA or Agency) guarantees loans by qualified lenders to benefit rural businesses. For eligible projects, community banks can obtain an 80% guarantee for loans up to $5 million, a 70% guarantee for loans between $5 million and $10 million and a 60% guarantee for loans between $10 million and $25 million. The B&I guaranteed loan program allows lenders to expand their loan portfolio, obtain a deficiency guarantee, increase earnings by participating in the secondary market, make loans in smaller communities with traditionally lower collateral values and extend loans above their legal lending limits.

For each loan, lenders submit a detailed guarantee application to the Agency office in the state where the project is located. Approval or denial decisions generally take several weeks. Projects eligible for B&I financing include business acquisitions, commercial real estate purchases, startup costs and working capital, machinery and equipment purchases and some refinances.

On December 17, 2008, the USDA published a new interim rule pertaining to the B&I loan program in the Federal Register. Effective October 1, 2009, the new rule is designed to streamline the application, accelerate the guarantee approval process and expand the types of eligible projects. The Agency ultimately decided to abandon the new rule and instead focus on working within the existing regulatory framework to improve the B&I loan program.

Under the previous rule, the B&I loan program required lenders to compile burdensome applications and to deal with lengthy approval timelines and limited loan features. For example, a common lender complaint has been the laborious guarantee application process. For every loan under the previous regulations, B&I lenders had to submit to the local Agency all of their underwriting and loan approval documents, at least three B&I application forms, the draft loan agreement, copies of loan origination and servicing policies and procedures, and details concerning lending history, experience and their relationship with regulators. The Agency also awarded guarantees on a “priority scoring” basis, which gave loans in particularly rural areas with compelling purposes priority over otherwise eligible loans that earned a lower “score”. An approval or denial decision for lower scoring loans could take months from the application submission.

The USDA aims to reduce these drawbacks with the revised rule. The new rule attempts to streamline the original application process. Lenders must apply to participate in the guaranteed loan program by submitting background information such as descriptions of lending history and experience, policy and procedures and documentation concerning regulatory compliance (7 CFR 5001.9). Although lenders had to submit this information under the old rule, they are now permitted to submit summaries instead of copies of their policies and procedures (

The fiscal arrangement for starting a business enterprise is referred to as capital. Whether the business is big or small, capital or the initial investment is absolutely necessary. The next thing which is vital for any organization is the accounting methods or the accounting services employed. Every company needs to keep a record of all its monetary transactions and gains for which it essentially needs to consider accounting services, instead of getting the work done in-house. Cash flow has to be efficiently managed, record of the inventory has to be maintained and finances have to be utilized appropriately. This translates into a lot of accounting work that has to be managed for the welfare of the organization.

Services for the purpose of maintaining accounts are very necessary as they help the organization to maintain accounts, without losing out on space or business time. These services are also available online these days. Many organizations are being assisted these days with the help of online service providers for maintaining accounts. Various automated tools for accounting over the web are used which help in conducting and recording daily functions within the accounts department. These enhanced accounting services have proved to be a boon to a large number of organizations.

There is a lot of competition in the market, with organizations having to compete tooth and nail, and in facts and figures, with each other for survival. Proper accounting procedures are very necessary to make sure that the organization is able to accomplish its goals within the set period of fiscal planning. The company’s financial needs can be assessed only with the help of efficient results and accurate information made available by the accounting section. An accounting department cannot afford to make any error in the processes, and this calls for the accounting team to be specialized and experienced.

Accounting services, which are highly specialized, are able to deliver the best possible financial solutions to their clients. Financial advisors are able to provide proper advice on various problem areas within the balance sheet and tally books. Companies need to set aside adequate funds to hire the best services for accounting. The expenses incurred are soon taken care of with accurate books and balance records that help save a lot that error would otherwise claim! It is pivotal for any organization to invest in a good accounting service to evade audit issues.

In the world of investing there are two different positions that one can take. You can either be the owner of the investment of the lender.

For the purpose of this particular article we a going to discuss what it means to be involved in a lending investment.

The investment world is not always easy to figure out and be very confusing to many people. There are different buzzwords and jargon that are used by the insiders that seem like a different language to most people. This makes it seem like a very hard industry to enter.

Making the world of investments seem complicated through use of these tactics helps these insiders justify the high commissions that they charge and their expensive rates and fees. Understanding the investment world doesn’t have to be as complicated as it sometimes appears. It can be easily understood if you simply take it and break it down into its simplest parts.

Lending investments are a popular choice for people that are trying to break into the investing world. All that lending investing entails is lending your money to a bank, a company or the government. It is as simple as that.

In return for the use of your money the institution that you lend to will make you a specific promise. This promise will be that by a certain date you will receive your investment back in full and that in addition to that you will be given a bonus in the form of a predetermined interest rate that covers the duration of the loan.

Ideally and the best case scenario is that you get back your entire investment and the added amount that is your interest rate that was promised to you in the beginning. This is not however always the case. There have been many instances where this doesn’t happen.

These people unfortunately didn’t get back their investment in its entirety or didn’t receive the interest rate that they were originally promised.

With today’s economy it is crucial that you make sure that the company that you are investing with is solid. Even if they turn out to appear to be a good choice there a no guarantees.

The personal income tax laws in Thailand levy tax on a taxable person’s assessable income. A taxable person liable to personal income tax is subject to withholding tax by the payer of the income and is required to file a tax return and pay the balance of any tax due on a yearly (calendar) basis.

Taxable persons

Taxable persons are both residents and non-residents.

A resident is a person who resides in Thailand at one or more times for a period or periods aggregating 180 days or more in a calendar year. A resident is liable to tax on income derived from Thailand sources, whether that income is paid onshore or offshore, and on income from foreign sources that is remitted into Thailand in the year in which it is earned.

A non-resident is a person who residents in Thailand for less than 180 days in a calendar year, and is liable to personal income tax only on income from sources in Thailand.

Foreign expatriates

A foreign expatriate, whether a resident of Thailand or a non-resident of Thailand, is liable to personal income tax on income derived from Thailand sources (i.e. from the performance of duties in Thailand) whether such income is paid in Thailand or outside Thailand.

If a foreign expatriate’s residency commences in the year of arrival in Thailand, a foreign expatriate is also liable to personal income tax on any remittances of foreign source income, which is derived in the year of arrival.

Double tax treaties

Thailand has executed double tax treaties with over 50 countries and nearly all of these treaties contain a provision, which can exempt a foreign expatriate from tax on income earned from the performance of duties in Thailand, but this only applies in the case when all of the following three conditions are met:

The expatriate is present in Thailand for less than 183 days in any twelve months period; and The remuneration is paid by an employer who is not a resident of Thailand; and The remuneration is not charged to any company or permanent establishment in Thailand.

Assessable income

Thai tax law prescribes eight categories of assessable income, as follows:

Income from hire of services (services rendered to employers); Income from hire of work (from offices or positions held or services rendered); Income from goodwill, copyright and other rights, annuities, etc; Income from dividends, interest, share of profits, bonuses paid to shareholders and gains from the sale of shares; Income from letting out property on hire (rent); Income from performance of services by liberal professionals; Income from construction contracts and hire of work where materials and tools are supplied; and Income from business, commerce or industry etc, not specified above.

Assessable allowances and benefits

Assessable income also includes income received, not in cash but in kind. Allowances and benefits provided by an employer or other person, such as rent-free housing, children’s school fees and return air travel for home leave etc, are additional assessable income for an expatriate under the Thai tax laws.

Capital gains

There is no capital gains tax in Thailand. Capital gains derived by resident expatriates are additional income subject to tax at the normal personal income tax rates. Capital gains derived by non-resident expatriates are subject to tax at the flat rate of 15%.

The amount of the capital gain is simply calculated by deducting the cost price of an asset from the amount of consideration received on disposal of the asset. The cost price of an asset is not indexed for inflation.

For personal income tax purposes, the consideration received is the amount of “proceeds derived” from a disposal of an asset, which may or may not be the market price of the asset, which is the rule that applies for corporate income tax purposes.

Interest and dividend income

Interest and dividends derived by a resident expatriate from foreign sources are subject to Thai tax in the case when the income is remitted into Thailand in the same year in which it is derived.

Interest and dividends derived by a resident expatriate from Thailand sources are subject to Thai withholding taxes of 15% and 10% respectively, and an expatriate may (at his option) exclude such taxed income from his computation of personal income tax.

Interest and dividend income derived by a non-resident expatriate are subject to the same prescribed rates of 15% and 10%. A double tax treaty may prescribe a lower tax rate for interest in certain cases but no tax treaty prescribes a rate lower than 10% on dividends.

Royalty income

Royalty income derived by a resident expatriate from Thailand sources is included in the computation of his personal income tax and is also subject to withholding tax on payment at the rate of 3%.

And similarly to other forms of income, if a resident expatriate derives royalty income from foreign sources and the royalty income is remitted into Thailand in the same year in which it is derived, it is subject to tax in Thailand.

Royalty income derived by a non-resident expatriate from Thailand sources is subject to withholding tax on payment at the rate of 15%, but a double tax treaty may reduce the tax rate to 5%, 8% or 10%, according to the type of royalty.

Tax exemptions

A foreign expatriate employee need not include the following types of income in a computation of personal income tax in Thailand:

Income derived from a sale of immovable property that is acquired by bequest or by way of gift; Income derived from a sale of residential buildings if the income is spent to acquire a new residential building during a period of 1 year before and after the date of sale; Income derived from a sale of shares listed on the stock exchange of Thailand; Income from interest, provided that the interest is subject to 15% withholding tax at source; and Income from dividends or share of profits from a Thai registered company or mutual fund, provided that the dividends are subject to 10% withholding tax at source.