[et_pb_section fb_built=”1″ _builder_version=”4.16″ background_image=”http:\/\/www.humetaylor.com.au\/site\/wp-content\/uploads\/2019\/11\/banner-about.jpg” custom_padding=”64px|||||” global_colors_info=”{}”][et_pb_row _builder_version=”4.16″ collapsed=”off” global_colors_info=”{}”][et_pb_column type=”4_4″ _builder_version=”4.16″ global_colors_info=”{}”][et_pb_text _builder_version=”4.16″ _dynamic_attributes=”content” text_font=”Montserrat||||||||” text_text_color=”#ffffff” text_font_size=”60px” text_line_height=”1em” header_font=”||||||||” header_text_color=”#ffffff” text_orientation=”center” text_text_align=”center” global_colors_info=”{}”]@ET-DC@eyJkeW5hbWljIjp0cnVlLCJjb250ZW50IjoicG9zdF90aXRsZSIsInNldHRpbmdzIjp7ImJlZm9yZSI6IiIsImFmdGVyIjoiIn19@[\/et_pb_text][et_pb_divider color=”#B50038″ divider_weight=”5px” _builder_version=”4.16″ width=”80px” module_alignment=”center” global_colors_info=”{}”][\/et_pb_divider][\/et_pb_column][\/et_pb_row][\/et_pb_section][et_pb_section fb_built=”1″ _builder_version=”4.16″ custom_padding=”0px|0px|0px|0px” global_colors_info=”{}”][et_pb_row column_structure=”1_2,1_2″ use_custom_gutter=”on” gutter_width=”1″ make_equal=”on” custom_padding_last_edited=”on|tablet” _builder_version=”4.16″ use_background_color_gradient=”on” background_color_gradient_direction=”135deg” background_color_gradient_stops=”#ffffff 35%|#fafafa 35%” background_color_gradient_start=”#ffffff” background_color_gradient_start_position=”35%” background_color_gradient_end=”#fafafa” background_color_gradient_end_position=”35%” width=”100%” max_width=”2560px” module_alignment=”center” custom_margin=”0px|0px|0px|0px” custom_padding=”0px||0px|||” custom_padding_tablet=”50px|||” custom_padding_phone=”” global_colors_info=”{}”][et_pb_column type=”1_2″ _builder_version=”4.16″ custom_padding=”|4%|50px|12%||false” custom_css_main_element=”margin:auto;” global_colors_info=”{}”][et_pb_divider show_divider=”off” _builder_version=”4.16″ width=”16%” custom_margin=”||” global_colors_info=”{}”][\/et_pb_divider][et_pb_text admin_label=”Section1 – Content” _builder_version=”4.16″ text_font=”||||||||” link_option_url_new_window=”on” global_colors_info=”{}”]<\/p>\n
When establishing a new business, it is important to determine which type of business structure is the most suitable. Factors such as the size and type of your business, how you would like it to operate and its perceived future growth should all be taken into consideration.<\/span><\/p>\n Your choice of a particular business structure will have implications for:<\/span><\/p>\n Sole Trader\u00a0<\/b><\/p>\n A sole trader is the simplest business structure, where the business operates in the individual’s name. This business structure is relatively simple to understand, and is easy to register for GST, and with both the Australian Securities and Investment Commission, and the Australian Business Register. Sole traders retain all their profits and can use their own Tax File Numbers to lodge tax returns.\u00a0<\/span><\/p>\n However, sole traders hold unlimited personal liability, meaning if the business is sued, a sole trader\u2019s personal assets are at risk. Furthermore, sole traders are responsible for paying their own superannuation, and if they are injured or unwell and cannot work, they may be unable to access any income support.\u00a0<\/span><\/p>\n Partnership\u00a0<\/b><\/p>\n In general, partnerships are easy and relatively inexpensive to set up. Many law firms operate as partnerships. Partnerships involve two or more people, who jointly share the businesses\u2019 profits and losses. Unlike sole traders, partnerships must set up a separate tax file number. Tax is not paid on income earnt, but rather, each partner pays tax on their share of partnership income received.\u00a0<\/span><\/p>\n A partnership must be registered for GST if its annual turnover is $75,000 or more, however, it is best to seek accounting advice regarding tax implications for partnerships.\u00a0<\/span><\/p>\n There are three types of partnerships:\u00a0<\/span><\/p>\n Trust\u00a0<\/b><\/p>\n A trust can also operate as a business structure, where a trustee holds a business for the benefit of others (beneficiaries). Trustees are personally liable, as they are not considered separate legal entities. Trusts are useful for managing family assets and investment portfolios such as shares or properties, and can be beneficial for tax purposes.<\/span><\/p>\n The type of trust you choose will depend on your business and your prospective endeavours.\u00a0 Some common forms of trusts used are:<\/span><\/p>\n However, trusts <\/span>are complex and expensive to set up and operate. They require a formal trust deed, and impose certain duties on the trustees, who must undertake a range of formal administrative tasks, such as keeping accounting records and supplying relevant information to beneficiaries. Furthermore, trusts are difficult to dissolve or change once established.\u00a0<\/span><\/p>\n Company\u00a0<\/b><\/p>\n Companies are separate legal entities, which are capable of being sued, suing others and incurring debt. They are typically complex to create and operate, but have greater access to capital, which is money available for day-to-day operations and future growth. <\/span>Companies are made up of members who hold limited liability. Members of a company include directors, who are responsible for the management of the company’s business activities, and shareholders, who are issued a share of the company’s stock. Companies must file an annual tax return, are closely regulated and must comply with the <\/span>Corporations Act 2001<\/span><\/i>.\u00a0<\/span><\/p>\n Joint Venture <\/b>\u00a0<\/span><\/p>\n Joint ventures are best suited for short-term, one-off projects. A joint venture is a legally-binding agreement that outlines the relationship between the people or companies involved in the venture. Joint ventures are commonly utilised in resource-intensive sectors such as mining.\u00a0<\/span><\/p>\n How can Hume Taylor & Co Help?<\/b><\/p>\n Choosing the best business structure for your business will depend largely upon the nature of your business, your financial goals and your personal circumstances. Hume Taylor & Co\u2019s Commercial Law team will consider all of these factors when advising you which business structure to select, and assist you to correctly set up and register your business, working alongside your accountant.<\/span> Contact <\/a><\/span>our Adelaide office on (08) 8223 3199, our Millicent office on (08) 8733 2500 or our Whyalla office on (08) 8645 7666 today to book an appointment with one of our qualified commercial lawyers.\u00a0<\/span><\/p>\n This blog was written by Associate Christopher Latella, with assistance from Clerk and Law student Ekaterini Kountourogiannis. <\/span><\/p>\n [\/et_pb_text][\/et_pb_column][et_pb_column type=”1_2″ _builder_version=”4.16″ _dynamic_attributes=”background_image” background_image=”@ET-DC@eyJkeW5hbWljIjp0cnVlLCJjb250ZW50IjoicG9zdF9mZWF0dXJlZF9pbWFnZSIsInNldHRpbmdzIjp7fX0=@” custom_padding=”300px||300px||true” custom_padding_tablet=”240px||240px||true” custom_padding_phone=”” custom_padding_last_edited=”on|desktop” global_colors_info=”{}”][\/et_pb_column][\/et_pb_row][\/et_pb_section][et_pb_section fb_built=”1″ module_class=”contact” _builder_version=”4.3.2″ background_color=”#fafafa” custom_padding=”0px|0px|0px|0px|false|false” global_module=”173″ saved_tabs=”all” locked=”off” global_colors_info=”{}”][et_pb_row use_custom_gutter=”on” gutter_width=”1″ make_equal=”on” custom_padding_last_edited=”on|desktop” _builder_version=”4.16″ use_background_color_gradient=”on” background_color_gradient_direction=”135deg” background_color_gradient_stops=”#ffffff 35%|#fafafa 35%” background_color_gradient_start=”#ffffff” background_color_gradient_start_position=”35%” background_color_gradient_end=”#fafafa” background_color_gradient_end_position=”35%” width=”100%” max_width=”2560px” module_alignment=”center” custom_margin=”0px|30px|0px|30px|false|false” custom_padding=”0px|100px|0px|100px|false|false” custom_padding_tablet=”50px|||100px|false|false” custom_padding_phone=”” global_colors_info=”{}”][et_pb_column type=”4_4″ _builder_version=”4.16″ global_colors_info=”{}”][et_pb_text disabled_on=”off|off|off” admin_label=”Text” _builder_version=”4.16″ text_font=”||||||||” text_text_color=”#ffffff” header_font=”||||||||” header_text_color=”#ffffff” header_2_font=”|600|||||||” header_2_text_color=”#000000″ header_2_font_size=”36px” header_3_font=”|300|||||||” header_3_text_align=”center” header_3_text_color=”#000000″ header_3_font_size=”24px” background_layout=”dark” custom_margin=”50px||20px|||” global_colors_info=”{}”]<\/p>\n [\/et_pb_text][et_pb_divider color=”#B5003B” divider_weight=”5px” disabled_on=”off|off|off” _builder_version=”4.16″ width=”16%” custom_margin=”||10px” global_colors_info=”{}”][\/et_pb_divider][et_pb_text _builder_version=”4.16″ custom_margin=”0px|||||” custom_margin_tablet=”” custom_margin_phone=”” custom_margin_last_edited=”on|phone” global_colors_info=”{}”]<\/p>\n\n
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