No, the typical clauses include the main beneficiaries (normally husband and wife) and include parents, children, grandchildren, etc. as potential beneficiaries. Keep in mind that the trustee always controls who actually receives a distribution and therefore the wider the better generally.
What is a corporate trustee?
A corporate trustee is used for asset protection and takes the place of an individual trustee who may be liable when acting as trustee.
Do I need to register my trust with ASIC?
You do not need to register the trust with ASIC. However, if the trustee is a company it must be registered with ASIC and if the trust carries on business under a name other than its own name, the name must be registered as a business name with ASIC. Separately, you will need to pay… Read more »
What is a trust?
A trust is an obligation imposed on a person – a trustee – to hold property or assets (e.g. business assets) for the benefit of others. These others are known as beneficiaries. Setting up a trust requires a formal trust deed prepared by a lawyer. If you operate your business as a trust, the trustee… Read more »
How does the R & D credit/offset system work?
Generally, the R&D tax incentive allows a small company to claim a 45% refundable tax offset for eligible activities. The incentive is quite concessional, compared to the value of a standard deduction of 30%. A couple of the key requirements: Total deductions relating to the activity for a year must be at least $20,000; You… Read more »
If a company pays tax, does this reduce the tax paid to employee/directors?
Income tax paid by a Company can be used to frank a dividend to shareholders – whereby the shareholders effectively get the benefit of the 30% paid, not employees who receive a wage. The Company obtains a tax deduction for wages paid, but has to withhold income tax on wages at the employees effective tax… Read more »
How much more expensive is it to maintain a company in comparison to sole trader?
Generally speaking, other than the one-off start-up costs of registration (approx $500 – $1,000), not much more. Annual ASIC cost is around $245, tax compliance and financial account preparation won’t cost you much more than what you are already paying for a business tax return as a sole trader, the only thing that changes in… Read more »
I’m starting my business as a sole trader, do I need a TFN, ACN or ABN?
As a sole trader, you can use your same individual TFN. An ACN is only used by Companies. You will have to register for an ABN if you do not already have one personally.
Will my business be taxed separately from my day job salary?
Unless you establish the business in a separate legal entity your income from the business will form part of your individual taxable income (i.e. if your marginal rate is 40% you will taxed @ 40% for this extra income).
How do I sell a business as a sole trader?
As a sole trader, you can only sell a business by selling the assets/IP/customer lists/etc. If you sell everything needed to continue to operate the business it will still be a sale of a going-concern. As a company you have the choice to sell the business + assets or the shares in the company, which… Read more »