I am a full time employee and want to start a small business on the side. If I go ahead and register a small business as a sole trader with an ABN, I understand that I need to update my details and...
Because the income of a side business is taxed at marginal rates there is value in considering a little tax planning.
If your spouse is not working then maybe you should consider either operating the business activity in their name or perhaps using a trust for the business so that the profits can be diverted away from the person with the highest income.
Hi all, I was just wondering about the treatment about some home expenses. I know that if you work from home you can deduct expenses (gas, electricity, utilities) depending on the use or percentage...
I think @Apurv Bhalla CPA has listed some great answers.
My perspective may not be as applicable as here in the United States things are a bit different (and to some degree can even vary state to state).
One of the biggest differences here between personal and company is your liability protection. If you are just a sole trader (sole proprietor) then your assets (finances, home, investments, etc.) can be subject to penalty whereas if you are a specific corporate entity (C Corp, S Corp, LLC, LLP, etc.) than your personal assets have more protection as long as you aren't comingling your personal and business finances (separate bank accounts).
You can still write off a home office, but similarly, it has to be separate (have a door to separate it from the rest of the house/apartment). Assets can be wholly written off or depreciated over multiple years, typically the method chosen depends on what will be (or is forecasted) to be more favorable from a tax perspective.
Utilities can be a bit tricky to calculate. You can use percentages, but it would likely be hard to prove that they were correct if audited.
Here you can also write off mileage (from a sole trader perspective).
You might be able to write off other items such as a cellular plan if that phone and its usage were strictly for business purposes.
The best advice I can give is to talk to a knowledgeable tax professional. They will be able to give you better guidance on what to avoid and potential write-offs you may have overlooked on your own.
When you think TAX couldn't get any more complex - and then the ATO does this... What do you think about the new withholding property tax?
Great question - would love to hear your thoughts @Amanda Hoffmann - Certified Bookkeeper, BAS Agent @Mark Chapman !
Value-based pricing is a strategy being used more often by accounting and even bookkeeping firms. The price is set by their ideal client's perceived value of a product or service.
Value pricing is customer-focused pricing, meaning companies base their pricing on how much the customer believes a product is worth. They take into consideration the demand for their services/product, years of experience, reputation, size, and many other factors.
Accounting Firm A
Focuses on e-commerce clients who use Etsy, Facebook Store, and other online sales formats. They are world-class in their expertise in this area and have many valuable connections. They have a reputation to not only solve complex problems but give advice that assists their clients to automate administrative duties.
Not many firms "niche" in this area. The avatar's perception of value due to their expertise empowers them to value price their services at a higher amount than other firms who service any business.
A friend has placed a deposit on a hairdressing salon at Hornsby. She has since found out that a previous employee had informed the ATO for paying her cash wages and they were subsequently fined a...
It will depend on how your friend is planning on purchasing the hairdressing salon. If the vendor (seller) is running the salon under a company structure and is planning on selling the company and thus your friend is buying the shares in the company, then any liability will become your friend's liability moving forward. Part of the purchase process should involve a legal due diligence as well as an accountig due diligence. This would involve a review of any current and potential liabilities such as outstanding ATO audits and liabilites which may include PAYGW on the cash wages. If I was advising your friend, I would advise them to buy "the business" and not the company, this way the liabilities remain with the company and current shareholder / director of the hairdressing salon and not your friend. The only liabilities that come over relate to employees that stay with the business such as long service leave and other entitlements. The legal due diligence along with the accounting due diligence usually arrange for a reduction on purchase price to cater for the assumed liabilities.
I'm starting a new business. As I'm unsure how much I will make per annum, should I still register for GST?
If you are starting a new business and expect to turnover less than $75,000 AUD (unless you provide taxi travel for passengers in exchange for a fare) registering for GST is optional. However, the ATO only gives you 21 days from the time you are aware that you will turnover more than the threshold to register for GST and they advise you to check monthly to ensure you are aware when you meet the threshold.
If you do not register for GST then you also do not charge GST to your customers and you will not be able to claim GST credits on your purchases. There are also special requirements in regards to invoices and tax invoices that you need to follow depending on what you choose to do.
You can find great information on GST at the Governments Business website, including some examples:
The ATO has also recently started a community forum, where you can get official answers from the ATO if you need more help:
You may want to consult an Accountant for their professional perspective. The answer to your question will greatly depend on your expected turnover.
I personally, depending on the venture would not register for GST until I gain moment with sales. Everything going well you will turn over more than $75,000 and be required to register.