Tax Planning - Do you have the proper business structure?

Annual tax planning is a particularly important exercise for small businesses to undertake to help minimise exposure to income tax. One of the key decisions you need to make is your business structure.

Choosing the right business structure for you

What you choose has an impact on:

• how much tax you pay
• whether you're considered an employee, or the owner of the business
• how much control you have over the business
• ongoing costs and volume of paperwork for your business
• the licenses you require
• the amount of paperwork your business has to comply with
• your personal liability
• the risks to your assets
• your ability to raise money
• asset protection
• set up costs

Your accountant will be able to discuss with you the right structure for you, and it will depend on the size and type of business and how you want to run it.

Types of business structures

There are a number of structures that you can choose from when starting or expanding your business including:

• Sole trader – the simplest structure, gives you full control
• Company – more complex, limits your liability because it’s a separate legal entity
• Partnership – made up of 2 or more people who distribute income or losses
• Trust – where a trustee is responsible for business operations

How we can help

If you are in need of advice to help you to decide on the most appropriate tax-efficient business structure or are considering a change to a business structure for asset protection or tax purposes, TaxAssist Accountants is here to help.

It can be a complex process which requires expert advice so book a free initial consultation today! Call us on 08 6245 7506 or make an enquiry here.

Date published 19 Apr 2023 | Last updated 19 Apr 2023

This article is intended to inform rather than advise and is based on legislation and practice at the time. Taxpayer’s circumstances do vary and if you feel that the information provided is beneficial it is important that you contact us before implementation. If you take, or do not take action as a result of reading this article, before receiving our written endorsement, we will accept no responsibility for any financial loss incurred.