Join us on this episode as we discuss his childhood in Sudan and how he adjusted to life in Australia, at an age that is turbulent enough as it is. He tells us about the best thing that ever happened to him at a time in his career when he didn’t even know what an invoice was, the practice he started with no brains but a lot of balls, and how an ad he saw in 2000 changed everything for him.

Timestamps:
00:46 | Not Just Your Average Property Tax Specialist
05:14 | I Love the Smell of Exercise and Emails in the Morning
06:55 | Where’s the Kangaroos?!
09:18 | Happy Days
16:12 | The Student Becomes the Master
18:25 | I Like This Guy
21:45 | A Travelling Man
23:56 | Focusing on People
28:28 | I Didn’t Have the Cash to do Property

Resources and Links:

[00:19:44] Behind my back in about week three when I'm supposed to go and take the other job, he goes behind my back and talks to the partner. And he says, 'I don't want the other guy. I like this guy. He's good with the client. I want to keep him instead.' And that was one of the best things that ever happened to me. 

 

This is Property Investory where we talk to successful property investors to find out more about their stories, mindset and strategies.

 

I’m Tyrone Shum and in this episode, we’re speaking with founder and principal advisor at Property Tax Specialist, Shukri Barbara. He immigrated to Australia from Sudan when he was 13 years old, studied commerce and marketing and converted his lecturers to clients. He went from making $4,000 in a year to being one of Australia’s most sought-after tax specialists.

 

 

Barbara has been in practice since 1985, and has always been against being labelled as just one thing.

Shukri Barbara:   

[00:00:46] From 2000, we've focused it on people with investments in property. So people will say, 'Look, you're a property tax specialist.' No, we try and think about people because people is really what the critical part is. So it's people who invest in property. That may be ownership, that may be direct to residential investment, commercial investments, building, construction, subdivisions, a whole lot of range that happens in there. 

[00:01:17] But the important part is people, they're the critical element. And that's who we're trying to help to get them to achieve their goals overall. And in the process, we try and make tax simple, in order for them to appreciate where it's coming from, how it's going to impact and what the issues are going to be there. And within that, we're trying to say, 'Well, okay, look, if we can just make sure you keep the money there by protecting your assets, by trying to get you to pay as little as possible in tax— legally, of course— and keeping the ATO offside. We don't want them unhappy. So we want to keep them on our side.' So offside, the bad things, we don't want to be there. There's plenty of opportunity, even within the legislation that the government and the ATO put up.

Tyrone Shum: 

These days he is mostly dealing with inquiries and consultations regarding the ever-changing market.

Shukri Barbara:   

[00:02:23] Since Amir has joined me as a partner in the practice, I do a lot of the phone calls. I'll take inquiries coming through. At the moment, what we've got is the market that has shifted, has created a lot of queries around capital gains tax, because everybody wants to readjust, sell. Buying is a bit harder at this point, because the market is so expensive, but people are trying to subdivide, in order to maximise. 

[00:02:53] So we return calls, we discuss with them, then we organise initial consults. And in the initial consult, what we're trying to do is really just understand the client. So we get them to tell us about themselves. And then we explain to them the basics, and then try and fit their situation into there and start to give them directions. Apart from that I do review the tax returns and sign off on some tax returns. I try and train and advise my team, wherever we're going. And there's a lot of research at the moment, as you've seen from the budget that's been announced a couple of days ago, the massive lot of changes that are coming through. 

[00:03:39] So not only do we have to maintain that, the government keeps changing it. On top of which they keep changing the technology associated. So we've got to keep all that going all the time. And sometimes it just becomes a little bit too much so we've got to take a step back just to put it in focus. But overall, the tax office from say, 10 [or] 15 years ago, doing pretty well in terms of working with the agents, and for us to be able to access the data they have on our clients. That's been fantastic. That's really been fun, so a credit to them as far as that goes. But the downside to that is that they know when you've gone to sleep and when you've got up and when you're going to have your milk and breakfast. And sometimes that becomes a little bit difficult because you just can't get away from it. 

Tyrone Shum:   

[00:04:34] I totally agree. Everything's so technology digitalised. Everything's online. Like I was surprised when I first saw my bank statements were all synced across into the tax port, I was like, ‘What?! Since when did that happen?!’

Shukri Barbara:   

[00:04:43] They've been going for years, mate, for about 20 [or] 25 years. They've been putting massive amount of dollars in every year until they've reached this point today.

Tyrone Shum:   

He has three daughters, aged 16, 15, and 12, so it’s safe to say mornings are pretty busy in the Barbara household!

Shukri Barbara:   

[00:05:14] You can imagine the first thing is trying to get everybody out. And 'Dad, you're going my way, can you drop me off to school?' or 'It's really early, I've got that early class.' I've got my eldest, she takes a little bit of extra maths. So she says, 'I've got to be at the school at 7:30.' So I've got to leave about seven. So I've got to wake up at about six, in order to make sure everything is done. And then of course, if there's anything left over from cleaning up the night before, then I just clean it up and make sure before I leave, so their mother is pretty happy with things and happy with me. 

[00:05:49] And then we'll try and get them across. And then when I come to the office, generally I like to take a walk, just to exercise. Especially in winter, it's a bit cold, you can't really do it early in the morning, which I used to in the summer. I would get up 6 o'clock, that'd be beautiful, just go for a walk, stretch out, say a little prayer here and there, it just clears your mind up a little bit. And when I get to the office these days, I'll just rug up and go for a walk around or go and pick up the mail, and in addition I just add a couple of steps up, couple of steps down just to get that exercise in. And then we come back and we open up the emails and check out what's happening and review what's being carried forward from yesterday.

Tyrone Shum:   

He was born in Sudan, in North Africa, and immigrated to Australia in 1970 when he was 13 years old.

Shukri Barbara:  

[00:06:55] Believe it or not, if you're religious or not, we came on the first of December. And the night before— we arrived here about 7 [or] 8 o'clock in the morning—Pope Paul the sixth had arrived. And the place was absolutely chockers. We could not get accommodation. And of course, we didn't understand that a motel is actually accommodation. So we were looking for 'Hotel.' Hotel just didn't didn't come up! So at the end of the day when somebody told us, 'Look, there's a motel.' So we all ended up there and arrived the first day here. So I guess the Pope blessed the country for us and said, 'Come on in.' 

[00:07:43] So from where we left, where we had a revolution, and there was a military coup and things were pretty tough. And we had to go out on the quiet down to this beautiful country. The disappointment, of course, is we couldn't see the kangaroos running across the road. I was walking out of the airport, I was looking for the kangaroos!

Tyrone Shum:   

[00:08:07] Where's the kangaroos, where's the koalas?!

Shukri Barbara:   

[00:08:09] That's it! And then this bloke, the porter comes up to my mother, and he says, 'You migrants, are ya?' And, like, my mother knows the Queen's English. It's not migrants, it's immigrants. She was just totally baffled because she's walking in with this leopard coat in the middle of summer, trying to get everything across through the customs. And this guy comes out, 'Yeah, yeah, righto. Listen, I'll just whack the bag over there. I'll take it.' It was a really lovely way to start. She just looked baffled. And then my father sees the situation and he asked the same thing of my father. And then he says, 'Look, my name is Habib. You're Australians, yeah, righto, okay, just put the bag up there. I'll take it.' So that was my introduction. On the first day of coming to Australia.

Tyrone Shum:  

He looks back fondly on growing up in Sudan, where he experienced a happy and carefree childhood.

Shukri Barbara:   

[00:09:18] Sudan was lovely. I was a real kid, didn't really know very much. Out there we were the minority, kind of being white and Christian. But still, we had other people of other religions in the school, the Catholic schools there. And we had the communities in where I was, what I can remember, in the areas. My grandparents were Syrian, my grandmothers. And so that's pretty much our background, overall, but my parents and myself, we were all born in Sudan. And within the groups, there was always Italians, Greeks, Egyptians, and everybody had their own little club and in the space we were living, we cooperated and sort of played around, particularly when we got to school together. 

[00:10:04] It was terrific at home, we had nice big sort of colonial type homes. And it was a lovely way it was supported. We had fun, we had absolute fun. I had no idea about life until we got out. And then we got out in this shock that I got out with Mum and my sister before Dad had to come out. So on the basis that we're going out on holidays, and then Dad managed to finalise things quietly and get out as well. And, of course, in the process, all the money that was came out as nothing, when you got it out, because you couldn't really take money out. Officially, the Sudanese Pound was equal to the sterling pound, but unofficially, because you can only get 10 cents in the dollar for it. 

[00:10:49] So we came out, as it was, and we left whatever it was behind. And it was quite an experience to come out here and learn about the new way of doing things, the more Anglo Saxon type style. So when we came out, I was the wog and the camel driver. You don't hear those terms much often these days in school. And so we tried really hard to assimilate to get on with life. We didn't want to be different. We wanted to be the same. But of course, with a name like Shukri, that was pretty hard. 

[00:11:26] I remember my first couple of weeks in school, this bloke comes up to me and puts his arm around my shoulder says, 'G'day Mike, how ya goin'?' I sort of looked at him and says, 'My name is not Mike. It's Shukri.' He says 'Oh, yeah, and you're Australian. Righto, how ya goin'?' And then I found out later on that he was actually Spanish.

[00:11:54] I had experiences through the first year trying to learn about what football really is. I knew football is a round ball you kick, not an eggy kind ball that you go kill people to get and pass on, and that was my introduction to rugby. And then the first time I played actually, they found out that I could run! They gave me the ball and they said, run. So I ran and I scored two tries. Well, the old boys didn't like it very much. So the next week we came along, they gave me the ball specifically so they can all pile up on top of me, both teams. And then when I got up, I would see all my jaw hurts. I couldn't exactly work out why my jaw hurts. And then later on in the playground, two kids, they're sitting around, talking 'I got him. I got him. Yeah, yeah!' Oh, yeah. Right. Okay. That's the way the game is played. Keep it. I went to athletics.

[00:12:59] By the time we got around to fifth form, I was the eldest more or less, I was the first one to get my driver's license. And I was showing off by bringing my father's old station wagon Falcon, 1970s style, into the school. By that stage, we were trying to get to the pub. And it was alright, by that stage. It was quite a good experience.

Tyrone Shum:   

[00:13:26] Wow, how many kids did you have in your family, how many siblings?

Shukri Barbara:   

[00:13:29] There's about three of us. But my eldest brother, he was overseas for a while. He was actually in Jordan. And he was in Jerusalem specifically. He was trying to be a priest at the time, before the takeover and when these rallies took over the place, they limited access in and out. But anyway, he finished there and then he went to work because he had language skills. He found himself with a  group, and he was actually translating for the Italian surgeons who were helping out in the civil war there. And then he was a reporter. And so he was reporting for the Italian news agency, as well, as a news reporter. And then when he got caught one time going between right and left, we arranged for him to come here.

[00:14:27] And then we've got my sister. He's a bit older than me and my sister's about nine years younger than me, and she's quite a dynamo. She's very good at what she does. I can't really share what she does, because it's a bit secure. But she got on pretty well. 

[00:14:56] There's some government affiliation, so I can't really talk about it. Not that I know, because she doesn't really tell me the details. But some of the stuff you've heard in the budget this week was a little bit of her work, in the background work, trying to bring people into Australia, the technology side. Rather than be out in the United States, bring the Australians who are in the United States back in to improve our lockdown here.

 

Coming up after the break, we hear about Barbara’s travels...

 

[00:21:45] Then I sort of changed tack, I sold a little bit of the practice, kept some of the practice, and continued on, took a little bit of a break. Because by that stage, I was a bit burnt out and decided to take a little bit of a break. 

The company that helped him gain valuable confidence...

 

[00:25:11] In 1985, I joined the group called SWAP— Salespeople With A Purpose. And the experience I gained through being part of that club is fantastic. They taught me how to stand up and talk and they taught us how to be comfortable and do things, and then they made me into the treasurer. 

 

He shares a time when everything changed and he needed to adapt.

[00:27:28] But the key was in 1985, we just kicked off in the practice and they introduced capital gains tax and imputation credits and dividend franking, and all of that stuff just came in. We were sitting there and I said, 'I didn't take all that at uni.'

And that’s next. I’m Tyrone Shum and you’re listening to Property Investory.

 

 

Barbara is grateful for being an Australian university student at the time of the Whitlam government.

Shukri Barbara:   

[00:15:45] Thank you to Gough Whitlam. And the Labour Party at the time. I got educated for free.

[00:15:53] University was a free education for me. And my sister, she paid a little bit but still relatively free. So that was great. But that was absolutely a gift to the wogs and the things coming up with no money and nowhere to go.

Tyrone Shum:   

[00:16:12] And what did you study at university?

Shukri Barbara:   

[00:16:18] I did want to study medicine, but I never quite made the mark. So we went into commerce and did the accounting major. And went from there. And then quite a few years later, I did do a postgraduate in marketing. I was running an accounting practice and trying to do marketing, as well. So that was quite interesting, trying to understand how to market the practice after that. So it was a quite good experience.

[00:16:54] It was on average, a couple of years. It just depends how many subjects you take per semester. I finished it in two years. By the time I finished, I actually converted three of my lecturers as clients.

Tyrone Shum:   

[00:17:13] That's great to hear. That's what you want, I guess!

Shukri Barbara:   

[00:17:17] Absolutely! I must have listened to their marketing and did it right.

Tyrone Shum:   

[00:17:21] Yeah, you've just basically put it back to them and say, ‘By the way, guys, this is what you should be doing.’ 

Shukri Barbara:  

[00:17:28] Yeah, because I was a bit older, and a lot of the kids were a lot younger. But what I was saying made sense to them. And so they came across. For me, that was quite satisfactory, to see that we've done things right. 

Tyrone Shum: 

After finishing university in 1985, he went straight out to work, taking on an intern position.

Shukri Barbara:  

 [00:18:25] I went to work, I remember, for Brambles at the time, as an intern type thing in the audit section. And then after I finished my exams, and I had to repeat one of the subjects. So after I finished that, I was working in the public accounting, chartered accounting sort of area, and I managed to get one of those jobs. And at that time, I was being brought in to cover a particular area where the firm had a client who was a managed fund of sorts, and they wanted to make sure because at that time, there were some big crashes. And they work to make sure that every check that the company the clients pays out, is audited. 

[00:19:09] So I was supposed to be brought in and replace a guy who was doing that. Because I started on the 30th of June and that was the end of the financial year, the guy had to finish off for the year. So they put me through with one of the audit managers. And for me, who didn't know what an invoice was, that was the best thing that ever happened to me. 

[00:19:34] He took me out on the audit trail and we discovered how all these companies work and where they come from, and looking at the invoices and how payments are made. And then behind my back in about week three when I'm supposed to go and take the other job, he goes behind my back and talks to the partner. And he says, 'I don't want the other guy. I like this guy. He's good with the client. I want to keep him instead.' And that was one of the best things that ever happened to me. Because by then I went out, I saw clients, I saw how things were done, I talked, I learnt about business, just from an audit perspective. 

[00:20:12] After that, I was doing that for a bit over a year, he went and joined another fellow as partners in a firm, and he head hunted me. So I went out with him, focusing on tax rather than audit. It went from there. I went to I think it was Reader's Digest, I went to work at Reader's Digest for a little bit. And I got involved a little bit in politics. So I got a bit busy there and then left Reader's Digest. 

 

[00:20:45] By 19, I had the opportunity— they were changing the laws regarding membership when giving out practicing certificates for accountants—I took the opportunity, just using my experience, rather than to have to sit for more exams and things, and got my practicing certificate with CPA. And from '85 onwards, I joined a friend of mine to start up a practice. With more balls than brains, really. 

[00:21:12] And so we kicked off and we did things all the wrong marketing way, I can tell you now from experience. We were putting things in letterboxes and 'Come and do your tax returns!' and these were the days where you had to do it manually or type it up all that sort of stuff. And that's how we kicked off. Later on we split with the partner and then I just kept going by myself right up until 1999. 

After working nonstop for so many years, he took some time off to travel.

[00:21:45] Then I sort of changed tack, I sold a little bit of the practice, kept some of the practice, and continued on, took a little bit of a break. Because by that stage, I was a bit burnt out and decided to take a little bit of a break. And I also met this girl. She was an Irish girl running, still got a world tour of ticket. I said, 'Look, I'm on holidays, I'll go with you.' So we went around Europe. 

[00:22:17] Firstly, actually, we went to America where I attended my cousin's wedding in Canada, and then came around to the United States where my uncle lives. And saw that and then started our journey around South America, which is really what she wanted to do. Because she had seen most of the other world so in between Argentina, Chile. And then Cusco in... I can't remember the country where Cusco is. Anyway, where the Incas and so forth were at. That was really an experience I can tell you, is a really an experience there. And then back to Europe to see family and so forth. And that was an interesting exercise. And I tell you what, by the time I came back, I was glad I'm in Australia. You can't imagine. This is the best country ever. Best country ever. I was so glad.

[00:23:21] In 2000 we came back and there was a few of these ads, how to be rich out of property without a starting point, that's what they kept saying. I've always seen these ads and heard about them, but I've never really gone to see it. So having a bit of time on my hands, I decided to go to a free seminar and just sit down and listen. And then the guy comes up, and he says you can make rich, wealth, through property. And then he's saying, 'But you've got to have your team around you. I can't tell you.' He's still telling everybody. He says, 'I can't tell you, you've gotta have your accountant, your lawyer,' and whatever. 

[00:23:56] So I looked at the guy next door, and looked at the other guy on the other side, I said, 'I can tell you because I know all that stuff from the tax side. So I can tell you.' So we followed that guy a little bit and rode on his wave of creating interest in property as a class of asset. And so we came up, they wanted me to advertise in their magazine and their manager, who is an excellent guy, Reuben Buchanan. He was a terrific seller, he’s a very smart guy. At the moment, he helps people get into an IPOs and all that sort of stuff. And we came up with the name Property Tax Specialist. And that's where we started to focus on people with investments in property.

[00:24:46] We always had it running, but we kicked it off again because we did a few other things, we supported Associations. So we were the back office for professional bodies. But the margins were just so small and they favored people they knew from their own group rather than us. So we did that for a while, we actually learnt a lot. 

[00:25:11] In 1985, I joined the group called SWAP— Salespeople With A Purpose. And the experience I gained through being part of that club is fantastic. They taught me how to stand up and talk and they taught us how to be comfortable and do things, and then they made me into the treasurer. The first meeting, I went there, they made me into the treasurer. And that was the best experience because the guy who ran the place, a guy called John Nevin, he really built me up hugely. So that was fantastic. And I was invited there by a lady who used to run... she's actually a diamond in Amway, Diamond region, Amway. So we learnt a lot through her and Amway as well, a lot of experience. So all I can add it to is life experience, which helps in understanding people, and the people's journey, and their aspirations of where they want to go and what they want to do.

[00:62:24] One of the other associations we also help run is something called National Speakers Association. And that was great because they talk about how to present properly and I'm there, ticking the names off. And once everybody is in I go and sit down and listen. So it was a great experience to hear how these guys operate.

Tyrone Shum:  

He bought his first property around 1983 in Hurstville, but didn’t fully commit to his property journey until 1985.

Shukri Barbara:   

[00:27:09] It went up for a while there, then when I started the practice, I needed the money. And so I sold it. I did make some gains on it at the time, capital gains started to come in. So I paid some capital gain, which didn't help overall. 

[00:27:28] But the key was in 1985, we just kicked off in the practice and they introduced capital gains tax and imputation credits and dividend franking, and all of that stuff just came in. We were sitting there and I said, 'I didn't take all that at uni.' So we had to learn all these new things coming through, and then going forward. So you can imagine my first year in being in practice, starting from June '85. I only made $4,000. I was sharing a flat. We used to have pizza on Monday, we'd have pasta on Tuesday and put the rest in the fridge for Wednesday and Thursday, and Friday, we'd go over to Mum's.

 

[00:28:28] And then we started the journey. So property was a bit limited for me in terms of the fact that what I didn't want to do, I didn't want my parents to help me. I wanted to do it on my own. So I didn't have the cash to do property. So what we did is by the time we came into focusing on property, we helped a lot of people, because we could understand the journey, we could understand people and that's the whole idea. It's about people. Wealth can be made. 

[00:28:58] And of course, Dad had a lot of properties. And we had it as a family. We had family properties out at Belmore and around those areas, we had a couple of unit blocks. Until at one stage Dad got sick of having to tell the agent to fix things up and one time it went really bad. So what we did is we actually sold them. So we sold them and then I restructured them. By that stage I was into the practice pretty well. And we restructured the whole property of things and we made it into the kids' properties. So rather than go to the bank, we borrowed from the family and restructured it in a way where the family can also access other benefits. 

 

[00:29:44] And then after that, of course I got married. And when you get married, mate, you can't save a cent! So since I got married I just spend it all! And it didn't help that I also lost money on the stock market, some of the gains I made from the first property, there was the dotcom crash, took a little bit of it. And then we were working together with someone before the September 11 planes. And that caught us out because we were doing in derivatives. He took us, about five [or] six of us, from 300,000 to about 650 in six months. 

[00:30:27] The mistake we made is we pulled the profit out, because the crash came in and the broker says it's a margin call. And of course, the guy running things was just outside of Brisbane, he didn't have the connections to say, look, we got the money. The broker didn't want to take the risk. He wanted the money, like, immediately. 12 o'clock midnight is when he called. So that wiped us out. 

[00:30:53] So from there on, we just sort of stuck with property, which is less volatile. And we just help people because now we understand when to do things, how to do things. But a lot of the time, what we do is we facilitate for them because property is a different kind of animal. And when you want to create wealth through property, you look at your strategy, you've got to have a strategy. You've got to start with a strategy. Are you going to hold long time, are you going to do short term, are you going to develop? There's a number of very basic strategies. And as long as you focus really clearly on those, you can get ahead.

Shukri Barbara’s story continues in the next episode of Property Investory. He divulges what’s most important to him, business-wise...

 

[00:05:13] We've always said, 'What do the clients want at the end of day?' Because the first thing is, of course, the clients. Nobody cares how much you know, until they know how much you care. So once we've established that relationship of trust, then we try and understand where they're at. 

 

He tells us about one particularly happy client...

 

[00:10:22] Because in all the years he lived in it, he didn't get any rent. So all that forms part of your cost base. So now it's on breakeven, he's got a little bit of a capital loss. So there's no tax.

We discuss the importance of timing.

[00:12:56] If you're going to save some money by doing that, we compare the savings with the cost. If it's going to take you two years, and you're going to make it up, okay, that's not too bad. If it's going to take you 10 years to make it up, well, why pay the cash now? 

 

And that’s next time on Property Investory.