Business Advice Info

[Superdan]

G'day all, I've been toying with the idea of starting a trading business and need to know the ins and outs of getting started. Primarily to do with registering business name/ABN/Tax requirements etc.

Really just looking for a possible way to write off some expenses and gradually grow a small business.

If anyone can help either via email (daniel.steel@iinet.net.au) or in here (may be beneficial for other members too) it would be greatly appreciated.

Cheers in advance

Dan

Edited 23/03/09 09:21 AM by Superdan

[Rootster]

what ever you do the tax deparment allows you to run the first 2 years at a loss and then on the third year you only need to show $1 profit.For GST you only need a abn number if your turning over 50k a year.Speak to your accountant he will give you the best advice in reguards to tax saving loops.

[Superdan]

Well, that's already bloody helpful, cheers Nick.

Is there any pluses to not having an ABN? or is it worth just having one? Free to obtain right?

[Rootster]

pro's and con's both ways.IT is free to obtain.Alot of paper work if you register for the gst,but can claim back all gst on your expenses.If you take your car to the drags you can tell them its advertising,sell your car to your business and pocket the cash.Really you need to speak to your accountant he knows best.This is an example: if you own a pizza shop and your claiming $50k a year in expenses the tax deparment has an average income for all the pizza shops in australia.So if the average is income or turn over is $250k and your claiming $150k the bells start to ring at the ato,the best advice I can give you is get yourself a great account, he will save you heaps in the long run.Cheers Nick

[ronburgundy]

1. No offence dude but that thing about 2 years of losses and then $1 profit is rubbish (and yes, I'm legally qualified to give that opinion!)

2. GST turnover threshold is $75k; you turnover less than that in a year, no need to register for GST and p1ssf@rt around with all that paperwork

3. You ALWAYS need an ABN however otherwise any services you provide to someone, they're legally obliged to withhold 46.5% in tax (which you get back when you do your tax return, but still not great). Yes it is free to obtain

4. Selling your car to your business - really doesn't achieve anything you can't already achieve on your own (with a little 'finessing'). Not sure the advertising idea works either.

5. The pizza shop example is not far off the mark though.

Happy to give any more advice in here or via PM Dan

[harvyk]

Yes, I run my own business, and my advise is simple,

1. pay for good advice

2. be selective on who you take advice from, I'm sure the old bloke down the pub \ that great mate \ mother in laws brother is knowledgable, but unless they have been running a SUCCESSFUL business themselves, don't take their advise, it's amazing how many business "experts" there are working 9 to 5 jobs, and the most they have ever ventured in to the world of running your own business is they considered moonlighting one night.

3. Get to know a lot of people (eg go to networking events, even if you wouldn't think it could help your business), they can really help find people to help you with point 1, plus you never know, your next customer could be found at one of those events. (Hey, it's where I found my mechanic)

[ronburgundy]

Spot on re point 1 there - sooo many of our clients (and people in general) often find out THE HARD WAY that good advice costs good money! They try and skimp and then ask us to pick up the pieces when it all goes pear-shaped.

Not unlike a mechanic really I guess - good service generally doesn't come cheap.

[Rootster]

sorry dan if I said something wrong,mate I did this in 2000 and it was only 50k back then.My business is in the motor industry and I"m probably able to claim different things than other trades.In reguards to the drag car most of my mates in the trade write it off as advertising/sponsorship dollors.

I,m also allowed a promotions vehicle to display my work to promote my business.

I did tell you all along to speak to a an accountant.Cheers Nick

Edited 24/03/09 05:53 AM by rootster

[tig]

A good accountant is important, I have been using the same firm since 1986 and dont just talk to them just at year ending either. We meet a few times a year to make sure everthing is going as it should be and answer all my dumb questions. When you see all the paperwork that is sent to you to sign from your accountant for the ATO come tax time you soon realise that you would have little chance of attempting it yourself. My mother in-law cracks me up when she tries to talk to me about my business, I was telling her once how many vehicle/equipment leases , bills etc. that we pay monthly and her reply was ' Dont worry, you get it all back on your tax'. After about five minutes of trying to explain that she wasn't quite correct I gave up and changed the subject. Good luck with it Dan, and what type of business are you looking at getting in to ?

[crazed1]

Tip; find a good laundry service that will help for a while till you figure it all out