The sole trader business structure involves the individual personally operating their business. The advantages of operating a business as a sole trader include: Simple and easy for clients to understand. Cheap to establish and dismantle (basically just need a business name, ABN, GST registration and business bank account). No extra tax return required to be…
This strategy involves having a company’s ordinary shares owned by a family trust structure (instead of the individual directors). This applies irrespective of whether the company operates a business or holds investments. The advantages of this strategy include: Provides asset protection – If the directors personally go bankrupt then the company is protected as the…
This strategy involves purchasing a loss-making business and taking ownership of the company structure (to access the accumulated tax losses). Clearly this is only going to make economic sense if the purchaser can restructure and improve the business to turn the current operating losses into ongoing profits. This strategy can be attractive for the following…
A granny flat is a self-contained secondary dwelling built on a residential property. Granny flats must be self-contained with their own kitchen, bathroom, and living space. The cost of building a granny flat ranges from $60,000 to $150,000 with $100,000 an approximate average. Granny flats are great for older parents, university students, children moving out…
Language training courses designed to teach English or explain Australian citizenship and lifestyle to a person who is, or intends to become, an immigrant of Australia are tax deductible to the employer and FBT exempt. The travel costs incurred are also exempt. To qualify for the exemption the following conditions must be satisfied: The benefit…
This strategy is about using your private vehicle to operate an Uber business and make additional income (whilst at the same time making your private vehicle expenses tax deductible). Deductible Uber business expenses include: Fuel Registration Insurance Repairs, tyres and maintenance costs. Depreciation on the car purchase cost. Car purchase cost (if less than $20,000)…
This strategy involves employee’s salary sacrificing $1,000 of wages income (which is taxable) for $1,000 of employer provided goods or services (which is tax free). The goods or services provided by the employer must be same ones as they sell to their customers. So a clothing retailer for example, could provide $1,000 of free clothing…
Work-related counselling provided to employees (and their associates) in order to improve or maintain their efficiency at work or prepare them for retirement will be tax deductible and FBT exempt. It can be provided as individual or group counselling and can be related to matters such as: Quit smoking programs. Weight watches programs to lose…
Long service awards granted in recognition of 15 years or more service are tax deductible and FBT exempt, provided the value of the award doesn’t exceed the following specified amounts: $1,000 for 15 years’ service. Plus $100 per additional year of service. Where the value of an award exceeds the relevant maximum value, no part…
Providing the following work related items to employees is tax deductible and FBT exempt: Portable electronic devices such as mobile phones, laptops, tablets, portable printers and GPS navigation receivers. Computer software. Protective clothing Briefcases. Tools of trade. Even when employees salary sacrifice the cost of the items with their employees they still benefit from saving…
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"You’d be stupid not to try to cut your tax bill and those that don’t are stupid in business"
- Bono: U2