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Q: Hi,
I am looking to start up a Babysitting business where I hire employees also. I have already registered my business name and have an ABN, is there any thing else I need to do or register??
Thank you
A: Hi Aimee,
Congratulations on your new business. Child minding and baby sitting is a very tricky industry, and you need to make sure that you are complying with all legislation and compliance regulations.
First and foremost you need to ensure that you are in the correct structure - from an asset protection point of view, this is very important. Having just an ABN and running the business may be cost effective in the short run, but in the long term could cause you much grief if something goes wrong.
Next thing is the employees - you need to set them up properly, have workers compensation insurance, issue payslips, pay them the correct rate of pay etc, and comply with FairWork regulations.
Insurances for the premises is also very important, and if the business is being run from home, you need to also check with the local council for permits. There is much red tape around such a business.
Also a good idea to start on an accounting software of some sort, to ensure that you are recording all your income and expenses.
If we can be of assistance, please do not hesitate to contact our office.
Kind regards,
Jenny Thai
JTR & Associates
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Q: Question about managing income and tax implications of being a contractor with my income coming from one business. What is the best method/software to track income and how much to put aside for tax?
A: Hi Graham, we recommend Rounded if you are operating as a sole trader, and put away 20-30% for tax.
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Q: Hi I'm buying a small business and it's lets say $ 130.000. I have a mortgage of $270.000 (house value is $540.000. I have savings of $200.000..What is best to do with my savings ? put it on the mortgage, or buy the business.. Or invest elsewhere..
A: Hi Paul
Your situations requires careful planning and a good relationship with an accountant who will assist you in the process.
Having a debt that is tax deductible is preferred over have debt that is non deductible. But you also do not want to lock things in either, where possible.
I would suggest that you purchase the business with a loan, and leave the $200k in an offset against the mortgage (assuming it is the family home). Do not pay it down, as you may need to move the funds around (esp if you decide to make the property an investment property).
I hope this helps - I am available for a chat if you have questions.
Kind regards,
Jenny Thai
02 9144 3180
www.jtrandassoc.com.au
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Q: Have just finished creating my own website to start selling android boxes to turn your tv into a smart tv. I need some advice on setting up a business account and best way to go about it all as I already have a full time job and want to make sure I'm doing everything by the book tax wise. Just need to know my options as the website won't go line until all is sorted. Really looking to get up and running asap so need accountant to sort out all?Thank you
A: Hi Kevin
If you have a full time job, then potentially you should be looking at other structures, such as a company, to ensure that you are not paying too much tax unnecessarily. Then it would be a matter of ensuring that you have proper tax planning strategies in place.
Please feel free to give me a call to discuss further, if you have questions.
Kind regards,
Jenny Thai
JTR & Associates
02 9144 3180
www.jtrandassoc.com.au
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Q: Hi, I’m interested in understanding the techniques people use to keep their staff motivated and interested. We are getting too many complaints from customers and it is starting to affect our business?
A: Hi Joanne,
Sometimes it could also be a bad apple, ie. one staff that is affecting all staff with their attitude.
I would recommend that you have an external HR consultant or the like to see what exactly is wrong.
Sometimes it is not about the dollars and cents but about something simple.
If you need more guidance on this, please touch base with us, as we can put you in touch with someone that has helped our clients before.
Kind regards,
Jenny Thai
JTR & Associates
02 91443180
www.jtrandassoc.com.au
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Q: Hi,
I have been on workcover for the entire duration of the 2016-2017 fiinancial year. I am trying to complete my tax return, but cant seem to find anything that will tell me what or if there is anything I can claim for deductions. Can anyone help please?
A: Hi Anthony,
Work related expenses can only be claimed if there is a direct link to the income derived. Typically only travel relating to keeping the insurance going is the only item that can claimed. Also tax agent fees and donations made if any, and income protection insurance premiums.
Hope this helps.
Kind regards,
Jenny Thai
JTR & Associates | 02 9144 3180
www.jtrandassoc.com.au
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Q: I'm setting up a creative business and want to structure it so that a portion of our profits sit in a special fund we use to create our own stories in prose, theatre and video. Currently I own a pty ltd company, and two creatives are keen to work with me on a freelance capacity, and I'll set aside 50% of the profit from jobs we do through the company, putting that into a story fund. What's the best way to structure this fund's usage, particularly when someone decides to leave the arrangement?
A: Hi Simon,
It sounds like there are a few avenues to explore here, one being a not-for-profit entity or association to be set up, or potentially, it can just be a separate bank account set up, with the funds in that particular account being solely used for the special purpose.
This would ultimately depend on which direction you are thinking of taking it and whether the other creatives need to be involved in terms of authority or ownership.
If you need to discuss this further, please do not hesitate to contact our office. We work with many creatives and each have their own purpose and drive, and our clients have set up similar structures.
Kind regards,
Jenny Thai
JTR & Associates
02 9144 3180
www.jtrandassoc.com.au
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Q: Hi, I'm looking at establishing a business in alternative therapies - likely as a Pty Ltd (to access protection from individual liability). I want to purchase some equipment via the business and need to know what order of events is important to accessing taxation concessions. Do I need to establish the business as a Pty Ltd prior to purchase or would it be sufficient to simply register a business name? Thanks
A: Hi Christine,
In order to claim the equipment as part of your new business structure, the structure does need to be set up first.
Just registering a business name will be linked to your sole trader (personal name), which will still enable you to claim it if you decide to just operate as a sole trader instead.
If you are planning to set up as a company however, and want to claim it through the company, then it must be up and running.
If you need a hand with setting up the company, please do not hesitate to reach out.
Kind regards,
Jenny Thai
JTR & Associates
02 9144 3180
www.jtrandassoc.com.au
admin@jtrandassoc.com.au
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Q: Hi I will be receiving a vehicle allowance for all running costs and fuel for work. I would like to know best option to maximise claim against?
I intend to purchase new vehicle
A: Hi Chris,
Firstly you will need to be very diligent and keep a proper logbook for a period of at least 12 weeks. This will work out the % of the car expenses that you will be entitled to claim.
If you purchase a new car, you will also be able to claim depreciation as well as the interest on the loan (if you are planning to get it through finance).
If you would like a tax checklist to help you with regards to the car claims, please contact us below.
Kind regards,
Jenny Thai
JTR & Associates
02 9144 3180
admin@jtrandassoc.com.au
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Q: I'm looking at buying a franchise, is it best to pay cash or obtain a business loan?
A: Hi Jon,
You would be getting a loan to assist with cashflow. Starting a new business is always difficult and there is always teething problems in the beginning.
You could get a loan initially, to see how things go with the business and then use the cash to pay the loan off if things are running smoothly.
Please make sure you do get accounting and legal advice before taking any further steps.
Kind regards,
Jenny Thai
JTR & Associates
02 91443180
www.jtrandassoc.com.au
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Q: My partner and I purchased an investment property.She no longer works and therefore she recieves no tax benefits .Can she legally transfer her share in the property to me and incur no costs to do so.I am at present paying all costs but only recieve half of the tax benefits...??????
A: Hi Paul,
Unfortunately no, as the declaration of rental income and expenses is based on the legal ownership of the property. If it is jointly owned, then it must all be split 50/50.
Kind regards,
Jenny Thai
JTR & Associates
02 9144 3180
www.jtrandassoc.com.au
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Q: Hi Jenny,
I run a contracting company.
When I only sell product to my clients and not materials and services. What should I expect to pay regards to tax?
My partner seems to think that I would be paying more tax overall when I offer just materials.
I am a sole trader under a trust.
Thanks
Col
A: Hi Col
You are most welcome. I am happy to have a look at your structure at the very least, at no charge, just so that you know exactly what sort of structure you are in.
Your structure can help to determine if there are any tax planning options to you, to ensure you pay the least amount of tax possible (legitimately).
Kind regards,
Jenny Thai
JTR & ASSOCIATES
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Q: Hi Jenny,
I run a contracting company.
When I only sell product to my clients and not materials and services. What should I expect to pay regards to tax?
My partner seems to think that I would be paying more tax overall when I offer just materials.
I am a sole trader under a trust.
Thanks
Col
A: Hi Col,
Firstly, what is your structure, as you cannot be a sole trader under a trust. You are either a sole trader, or a trust (and you receive distributions from that trust). If you are not sure, you can send across your ABN (the one on your invoices), and we can look it up for you.
The tax payable calculated on your net profit, and whether you sell products VS materials and services is irrelevant to the tax calculation.
It would be a good idea to:
1. See if you are in the right structure first
2. Discuss in more detail regarding your partner's comments, as on surface, it is incorrect.
If you would like to have a chat, please feel to contact me directly below.
Kind regards,
Jenny Thai
JTR & Associates
Email: jenny@jtrandassoc.com.au
Phone: 02 9144 3180
Website: www.jtrandassoc.com.au
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Q: Hi Guys, I currently earn about $80K PA, my wife earns about $25K PA. Im 50 and my wife is 48. We have a standard fixed home loan of $470K. I have $600K invested. Car loan of $70K and a credit card with $25K max, $7K owing. Ive just done my 2016 tax return and have to pay the ATO back $6K :( They now also want me to advance quarterly payments of $2K starting in July. WTF!!! What can I do to reduce my income tax??? I am definitely not a rich man, but Im sure the ATO think I am!!! HELP??
A: Hi there, I would be looking first at why you had the 6k in tax owing. Were you under taxed in your salary? Also what is your 600k investment? If it is positive returns and it is flexible, you may wish to consider moving this to your wife's name.
There are plenty of tax planning options available, but hard to specify which ones would be suitable without more detailed information.
Happy to have a chat with you if you need.
Kind regards,
Jenny Thai
JTR & Associates
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Q: Hi Im about to finalize my divorce settlement and will have a sizable amount of money with which I hope to put a deposit on a house in the next 12 months I am wondering how I should go about banking this large amount and will i have to pay tax on it now or just on the interest ?
A: Hi Lee
Proceeds from a divorce settlement is not taxable income and you do not pay tax on this amount.
If you use the funds to invest, then the income received from the investment is taxable income to you and must be declared on your tax return.
Hope this makes sense
Kind regards
Jenny Thai
JTR & Associates
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Q: I work as an Engineer in the IT industry. I'm required to drive my car to work everyday so that I can drive to client sites in the event of emergencies that can't be resolved remotely.
Just want to stipulate my car being available is a work requirement.
Am I able to claim the parking expenses for when my car is parked outside of my work?
A: Hi Stephen,
The parking expenses would be tax deductible, IF your employment contract specifically stipulates that you must have your own car available at all times, for work purposes. Your car must be parked somewhere to carry out your duties, so if you incurred parking fees as a result, then it would be claimable in your tax return.
We have called the ATO and confirmed also, with the reference number for the call being : The reference number for this call is 105 121 547 6626.
I agree with Suresh and Amy - it is best to have the expenses reimbursed if possible.
Kind regards,
Jenny Thai
JTR & Associates
