Company & Trust formation
Should you be looking at changing your structure from a sole trader?
Key advantages:
- The law treats a company as a separate legal entity. This means that in general you will not be held personally responsible for the actions of your business.
- Personal assets are protected
- Base rate entity company tax rate is 26% opposed to maximum individual rate of 45%
- With the use of a trust you can distribute income across the family group to minimise tax
Asset Protection:
- Do you have personal assets you wish to protect? E.g. Family Home, shares, cash
- Are you in an industry with a chance of being exposed to legal action?
- Do you wish to separate the financial and taxation matters of the business from your own personal affairs?
Tax Minimisation:
- Do you have a spouse or kids you can split the income with? Opportunity to make use of each family members tax free threshold of $18,200 if over 18
Business Development/ Succession Planning:
- Do you want the business to grow in the future? Important to have structure right from the start
- Market perception - Do you require a company to imply a certain scale and level of seriousness to clients and suppliers that a sole trader structure doesn’t match?
- Will you be looking to sell the business at some point in the future?
We can provide advice and assistance with establishing a company or trust and obtaining and ABN and tax file number (TFN) from the Australian Taxation Office.
We can set out the steps involved in starting a company.
This covers:
- Deciding if a company structure is right for you
- Choosing a company name
- Deciding how to operate your company
- Understanding your legal obligations as an officeholder
- Getting the consent of those involved in your company
- Registering your company, and
- Understanding your legal obligations regarding your company name, Australian Company Number (ACN) and Australian Business Number (ABN)