Setting up your own business is an exciting prospect and getting it right from the beginning is vital for success. Operating a business is not just about working for yourself, it’s about having the necessary management skills, industry expertise, technical skills, finance and of course long term vision to grow and succeed. During our initial consultation our aim is to gain information on you as an individual and your businesses motives and goals, recommend and establish a suitable business structure based on your requirements and establish a suitable method for accounting for the business. We will advise you of all obligations with the ATO, set up all necessary registrations with the ATO including obligations related to running a business.
The most suitable business structure for you will depend on numerous factors. Here at McMahon Osborne Group, we will work with you to gain the greatest possible understanding of your business needs as well as your personal goals to ensure that we can select the most appropriate business structure for your circumstances.
Here are some important factors you need to consider;
Your risk management strategy, including your exposure to litigation risks and the need for asset protection
The expected size, growth and income of your business
Whether or not you have a need for a nationally registered business name, e.g. If you want to operate under one name in more than one state
Who will be involved in owning the business and whether or not you plan to introduce equity partners or shareholders in future
Your career and work plans for the future, e.g. When you plan to retire, how long you plan to work for and if you are expecting to have time off
The structure of your family and whether you have beneficiaries to whom you wish to distribute income
The availability of reduced tax rates and other tax concessions (e.g. Capital Gains Tax concessions for Individuals) and how you plan to spend the money you earn
We can tailor our services to ensure that not only is your structure in tune with your personal goals, but also tax effective in the modern competitive business world.
An ACN (Australian Company Number) is issued by ASIC (Australian Securities and Investments Commission) to all new companies registered in Australia to facilitate the monitoring of those companies and also to give them a unique identity code within the structure of the Corporations Law of Australia. Only a company can be issued with an ACN.
An ABN (Australian Business Number) is a unique number issued by the ATO (Australian Taxation Office) to all entities that are in business. If an entity is trading as a business, no matter how large or small, they must apply to the ATO to acquire an ABN and must show that ABN on any invoices they issue. The ATO will then automatically issue a unique eleven digit number.
It is not necessary for an entity that has an ABN to be registered for GST if their annual turnover or income does not exceed $75,000.00. Confusion often arises between the two numbers due to the fact that the ATO will use the ACN as the basis for a company's ABN. A company's ABN will always consist of their ACN with a two-digit pre-fix.
When you hire a new employee you need to know your responsibilities to ensure you get the best outcome for your business. There are workplace laws that apply to all employees, so it’s important to understand the legal requirements.
We can support you in the process of ensuring you are Super Stream compliant. Some accounting programs such as MYOB and Xero already provide Superannuation features that satisfy the ATO’s Super Stream requirements. Other clearing houses are also available that satisfy these requirements. Please contact your accountant to see which solution suits you and your business.
A wide range of record keeping software is available, each with different features and prices. In recent times, software with bank feed automation has become increasingly popular. Programs such as MYOB and Xero generally have this automation process available which see’s your bank transactions automatically imported into the record keeping software (no more manual entering of bank statements!). Most of these programs also provide a Payroll and Superannuation feature. These programs generally have a monthly subscription fee that varies depending on the needs of your business. Ultimately as accountants, we will use whatever program is a best fit to you. It is best to contact your accountant to discuss which program may be appropriate for you and your business.
You can choose to use the simplified depreciation rules if you have a small business with an aggregated annual turnover (the total normal income of your business and that of any associated businesses) of less than $2 million.
Under these rules, you:
immediately write-off – deduct their full cost in the year you buy them – most depreciating assets that cost less than $20,000* each that were bought and used, or installed ready for use from 7.30pm (AEST) on 12 May 2015 until 30 June 2017
pool most other depreciating assets that cost $20,000 or more in a small business asset pool and claim
a 15% deduction in the first year (regardless of when you purchased or acquired them during the year)
a 30% deduction each year after the first year
write-off the balance of your small business pool at the end of an income year if the balance – before applying any other depreciation deduction – is less than $20,000.
If you choose to use the simplified depreciation rules, you must:
use them to work out deductions for all your depreciating assets except those specifically excluded
apply the entire set of rules, not just individual elements (such as the instant asset write-off).
You can choose to stop using the simplified depreciation rules or become ineligible to use them, in which case you'll then use the general depreciation rules. However, any assets in your small business pool will continue to be depreciated in the pool, even if you stop using the simplified depreciation rules.