oleander
2014-01-13 10:10:58
- #1
Hello everyone,
since I am renting out a large part of my construction project from 1994, I was advised back then for tax reasons to structure the financing as follows:
The repayment of the loans is made at their maturity through life insurance policies, which become due at the same time. Therefore, during the loan term, only the interest is paid to the bank; instead of making repayments, contributions are paid into the life insurance policies.
This allows me to claim the interest on the debt as advertising costs with the tax office over the entire term and thus reduce the tax burden on the rental income.
Now, it is the case that life insurance policies consist of a part that comes from the interest and a part called surplus participation.
Since my financing still runs for about 10 years, I am slowly getting uneasy when I read the annual statements from the insurance companies. Long story short: the maturity benefits assumed by the insurance in 1994 will not be achieved. That this is related to the development on the capital market makes sense to me; the insurance companies cannot perform magic and can only generate the profits that the market allows.
Of course, this is of little use to me because in 10 years there will be a gap between the loan amount and what the life insurance policies will pay out.
My question now: do I have to bear this difference alone or is joint liability of the bank conceivable here? My reasons for this assumption are on the one hand that at that time no risk was pointed out that the payout amount of the insurance might not be sufficient. On the other hand, it could be interpreted that the loan is repaid with the insurance, therefore the insurance repays the loan, regardless of what it finally pays out. If the loan agreement says: the loan is repaid by the life insurance XXX, then as an unaware bank customer at the time, just under 30 years old, I could assume that instead of making repayments to the bank, I faithfully pay into the life insurance policies every month and that repayment is thus guaranteed.
What do you think?
Regards
Oleander
since I am renting out a large part of my construction project from 1994, I was advised back then for tax reasons to structure the financing as follows:
The repayment of the loans is made at their maturity through life insurance policies, which become due at the same time. Therefore, during the loan term, only the interest is paid to the bank; instead of making repayments, contributions are paid into the life insurance policies.
This allows me to claim the interest on the debt as advertising costs with the tax office over the entire term and thus reduce the tax burden on the rental income.
Now, it is the case that life insurance policies consist of a part that comes from the interest and a part called surplus participation.
Since my financing still runs for about 10 years, I am slowly getting uneasy when I read the annual statements from the insurance companies. Long story short: the maturity benefits assumed by the insurance in 1994 will not be achieved. That this is related to the development on the capital market makes sense to me; the insurance companies cannot perform magic and can only generate the profits that the market allows.
Of course, this is of little use to me because in 10 years there will be a gap between the loan amount and what the life insurance policies will pay out.
My question now: do I have to bear this difference alone or is joint liability of the bank conceivable here? My reasons for this assumption are on the one hand that at that time no risk was pointed out that the payout amount of the insurance might not be sufficient. On the other hand, it could be interpreted that the loan is repaid with the insurance, therefore the insurance repays the loan, regardless of what it finally pays out. If the loan agreement says: the loan is repaid by the life insurance XXX, then as an unaware bank customer at the time, just under 30 years old, I could assume that instead of making repayments to the bank, I faithfully pay into the life insurance policies every month and that repayment is thus guaranteed.
What do you think?
Regards
Oleander