investment

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investment

nosherwan
What should I do if some of my relatives gives me money for investing on his behalf in those case,  buying a property, when the price goes up I sell it and then we share the profit.
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Re: investment

Maf. King
On Tue 14 July 15 10:43:35 nosherwan wrote:
> What should I do if some of my relatives gives me money for investing on his
> behalf in those case,  buying a property, when the price goes up I sell it
> and then we share the profit.
>
>
Hi,

IMHO, the first thing you should do is seek professional advice about your
local laws and tax implications for partnerships (and their dissolution -
relatives can fall out over commercial matters just like any other partners).

Within gnucash, I suggest you have new file for your "partnership property
company" and record each partners contribution as equity.

In your personal books, probably a loan to Assets:LoansGiven:PropertyCo
as the profits come back, you gradually reduce that loan to zero, then start
recording the excess as income, but it will all depend on your local tax
reporting requirements, which I'm not qualified to advise upon.

HTH,
Maf.

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Re: investment

Peter von Kaehne
In reply to this post by nosherwan
There are a bunch of different ways of describing what you want to do.  Partnership is one of them where one brings in money another skill. It seems also akin to a Sharia based loan where the loangiver does not earn interest but participates in the success ( or lack of it), so your accounting method relies heavily on your local laws.

PeterOn 15 Jul 2015 08:49, "Maf. King" <[hidden email]> wrote:

>
> On Tue 14 July 15 10:43:35 nosherwan wrote:
> > What should I do if some of my relatives gives me money for investing on his
> > behalf in those case,  buying a property, when the price goes up I sell it
> > and then we share the profit.
> >
> >
> Hi,
>
> IMHO, the first thing you should do is seek professional advice about your
> local laws and tax implications for partnerships (and their dissolution -
> relatives can fall out over commercial matters just like any other partners).
>
> Within gnucash, I suggest you have new file for your "partnership property
> company" and record each partners contribution as equity.
>
> In your personal books, probably a loan to Assets:LoansGiven:PropertyCo
> as the profits come back, you gradually reduce that loan to zero, then start
> recording the excess as income, but it will all depend on your local tax
> reporting requirements, which I'm not qualified to advise upon.
>
> HTH,
> Maf.
>
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Re: investment

nosherwan
You're right Maf, you can say its a sharia based loan...
so how would you go about this?
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Re: investment

Maf. King
On Wed 15 July 15 01:23:47 nosherwan wrote:
> You're right Maf, you can say its a sharia based loan...
> so how would you go about this?
>

Hi,

Sorry, no idea. I didn't mention Sharia, that was Peter...

Maf.

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Re: investment

Peter von Kaehne
On Wed, 2015-07-15 at 13:00 +0100, Maf. King wrote:
> On Wed 15 July 15 01:23:47 nosherwan wrote:
> > You're right Maf, you can say its a sharia based loan...
> > so how would you go about this?
> >
>
> Hi,
>
> Sorry, no idea.

I guess the starting point is to explore what your jurisdiction wants
to see in terms of accounting.

Peter
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Re: investment

nosherwan
Oh right! Peter! :)
Peter, I'm not doing this for legal purposes. Just for organizing myself.
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Re: investment

Wm...
In reply to this post by nosherwan
Tue, 14 Jul 2015 10:43:35 <[hidden email]>
nosherwan <[hidden email]> wrote...

>What should I do if some of my relatives gives me money for investing on his
>behalf in those case,  buying a property, when the price goes up I sell it
>and then we share the profit.

This is an accounting and possibly moral rather than gnc question.

Now I've said that what I'd do is ...

work out if the money is a gift or not, i.e. if the whole thing turns to
rubbish do you owe the relatives money or not?

Y'see, a gift with strings attached isn't a gift, it is more likely a
loan and therefore you should enter it as something along the lines of

Liability:LoanFromRelatives           1
Assets:LoanFromRelatives         1

then use the Asset in the normal way.

If it is a genuine gift then use Income in place of Liability though
some people might argue for Equity rather than Income, but as above,
this isn't a gnc question really and you haven't said where you live and
we don't know about the taxation regimes in your country and your
relatives and so on ad infinitum.

Hope that gives you an idea in general, one leg is asset, the other leg
is a moveable feast.

Depending on the eventual outcome, which could take some time, I'd
suggest you call again later.

P.S. I like the price going up presumption, where can I buy some of
this?

--
Wm...

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Re: investment

Wm...
In reply to this post by nosherwan
Wed, 15 Jul 2015 01:23:47 <[hidden email]>
nosherwan <[hidden email]> wrote...

It was PvK not Maf

>you can say its a sharia based loan...
>so how would you go about this?

First off, I'm an atheist, which means I don't care.

Secondly, gnc is amoral.

Perfect stuff, eh?

I've helped some friends with this sort of thing before.  Mainly the
interface between formalised religious finance and practical use.

A usual problem is the presumption that the investment will result in a
positive return that can then be split.

That is also OK if it is purely monetary and you can afford to repay a
considerable part of the investor's stake.

The problems occur when the "guaranteed" investment you make on their
behalf fails.

Your debt fast becomes a real number and (depending on your personal
morals) one you and your family may need to pay personally.

Having said that there is a flourishing money transfer market whizzing
its way around the world without people getting into dangerous debt.

I suggest you think carefully.

gnc won't be useful in recording your death as a final payment :(


As I say above, "gnc is amoral", so recording the transactions isn't the
issue.

Best wishes.


Liz: my thoughts apply to merkin mafia, Oz biker gangs, ZA township
skollies, ad infinitum

--
Wm...

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Re: investment

Mike or Penny Novack-2

> I've helped some friends with this sort of thing before.  Mainly the
> interface between formalised religious finance and practical use.

The fact that the motivation for this kind of "loan" might be religious
(Sharia law) is irrelevant. Atheists might equally well be involved with
partnerships and joint ventures. Simply look up "accounting for joint
ventures" and apply what you learn there to doing it with gnucash. Or
"accounting for limited partnerships"  (in this sort of arrangement, the
lender would be a limited partner, the borrower the general partner).

Michael D Novack
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Liz
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Re: investment

Liz
In reply to this post by Wm...
On Sun, 19 Jul 2015 23:43:19 +0100
"Wm..." <[hidden email]> wrote:

> Liz: my thoughts apply to merkin mafia, Oz biker gangs, ZA township
> skollies, ad infinitum

my corner of Oz runs to mafia
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