A partnership of discretionary trusts is a partnership where each partner is a discretionary trust. This is a good structure for unrelated parties wanting to operate a business or invest together because: Provides each partner with a fixed interest in the partnership; say 50% each. Allows access to the CGT small business concessions. Provides…
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By calculating the true value of a customer, or potential customer, it places a value on the total sales and profits generated by the customer over their lifetime with the business. The actual numbers can be astounding. For example, although the initial sale may only be $100, the value of repeat sales over a 20-year…
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An incorporated limited partnership is an incorporated entity which is separate from the partners, has perpetual succession, and can sue or be sued in its own name. An incorporated limited partnership has the following structure: One or more general partners (whose liability is unlimited) and one or more limited partners. The general partners manage…
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Operating your business from home is an option if you spend most of your time working at client premises, deal with clients predominantly over the phone & internet, or just need a small office. Operating from home reduces your rental costs to nil. The main advantages of operating the business from home are: …
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A self managed super fund (SMSF) is a superannuation trust structure that provides benefits to its members upon retirement. The main difference between SMSFs and other super funds is that SMSF members are also the trustees of the fund. The advantages of establishing a family SMSF are: Tax savings – 0% on…
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In a typical husband and wife tradepeople partnership, one partner is qualified (for example an electrician) and produces the partnership income and the other partner may be involved in administration for the partnership. Profits from the partnership are normally split 50/50 between the partners. This structure was reviewed by the ATO in 2005 in…
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PAYG variations are attractive to taxpayers who have negatively geared investments (such as rental properties or share portfolios), and receive large tax refunds when lodging their annual tax returns. This strategy involves lodging a PAYG variation with the ATO in July of each financial year to bring forward the tax benefit. Once the PAYG variation…
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Reducing space usage and relocating to smaller premises will reduce rent costs (where the new premises have a similar cost per metre as the current premises). Businesses can reduce the space they use by: Going 100% paperless – documents and files are scanned and archived online instead of being stored as paper files…
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Mortgage offset accounts are savings accounts that are structured so your savings balance in the account is offset against your home loan account. The advantages of mortgage offset accounts compared to normal savings accounts are: The mortgage offset account balance reduces the interest payable on the home loan account. As no interest…
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If you have unused space, subleasing part of your business premises to a third party is a great short-term strategy to reduce some of your fixed costs. This will reduce your rent expense and provide extra cash flow. Subleasing typically makes sense when: Business conditions are tough – this reduces your overheads and…
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