HOW DOES A BUSINESS OWNER MOVE FROM MAKING A WAGE, TO MAKING PASSIVE INCOME?

I was wondering about the authorised and/or accounting aspects of when the commercial operation owners wants to stop pulling the salary from their company, instead have pacifist income. Does any one know the benifits or pitfalls of you do this.

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vlad August 15, 2010 at 8:10 pm

Legal aspect depends on whether you are sole trader or any type of public enterprise.
Accounting aspect – when you stop pulling your wage your company costs go down, your profit goes up and so does your income tax.
You will have no social securities and depending on your age it will hurt your pension volume if you pull your wage out.

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