wingnut wrote:Hi,
I have found this forum to be a wonderful repository of information, and have some queries which I hope will be answered here.
I am engaged in a line of self-employed work which some would call day trading (although I consider it multi-year trading actually!).
Doing so as an individual as opposed to a company means I am not required to pay tax, nor contribute to CPF. BTW, I'm local, and I'm not looking to cheat the system in any way.
It's all great except that now my wife has ceased employment to look after household affairs, there's no one in my family who's actually 'earning an income.' Or at least one that's easily identified as some sort of formal income.
Now as it turns out, I am looking at a personal venture which requires proof of income, not to mention the possibility of additional property purchases which will require financing.
Can I simply set up a private company for the sole purpose of paying myself annual dividends? The company won't actually be doing anything at all. Is there anything unlawful about this?
If it is viable, will the only way this dividend income show be in the annual tax return?
And does anyone have any idea how banks view this sort of income when assessing lending suitability? I do not expect to be approaching a bank for a loan until I have paid myself annual dividends for at least 2-3 years?
Again assuming it's a viable option.
Many thanks.
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