For many business owners, one of the drivers for being in business is the financial return. It is the reward for the risk you take and the effort you put in. There are plenty of other reasons that people go into business but for most, financial return is in the top 3 reasons.
As the business generates profits and cash, one of the questions you need to address is how much cash can I reasonably take out of the business. Tax and other issues overlay this and you want to make sure you do it as effectively as possible. Nonetheless the fundamental question is how much can we take out and how much should we take out? For some business owners the answer is as much as possible. For others they are content to let the business take its time. Irrespective of what your attitude is to this question you should consider it. You should know what your business should be producing and capable of returning to you. Whether you take it or not is another issue, but knowing how much you should be able to take is a key business measure.
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Tags: cash
Posted in Business Insight, Infotelligence |
In small business, you often need to innovate to survive. Despite this, the level of research and development (R&D) claims by the small business community is minuscule. While small business employs about half of the workforce, it only represents just over 10% of all R&D claimed.
But many SMEs complete research and development work in their business without recognising that this is what they are doing. If your business is undertaking R&D work, then you could be eligible for additional tax concessions or even a cash refund from the Government. So, what’s holding everyone back?
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Tags: Ausindustry | R&D Tax concession | R&D Tax Offset
Posted in Business Insight, Infotelligence, Uncategorized |
The FBT year runs from 1 April to 31 March. FBT is one of those areas that many employers struggle with; not because the tax is complex but because of the level of detail required to fulfill your obligations.
We explore:
- Key FBT issues
- How do I know if I need to pay FBT?
- What is exempt from FBT?
- Useful FBT links
Tags: FBT | Fringe Benefits Tax
Posted in Business Insight, Infotelligence |
Knowing what assets your Self Managed Superannuation Fund (SMSF) can own is an important part of being a fund trustee. You should also know what assets your fund can acquire from you or related parties.
New rules recently introduced may give more scope for your SMSF to borrow funds to acquire these assets but there are unique rules and guidelines that need to be adhered to.
As the trustees of your SMSF, you need to ensure that all assets held in the fund are consistent with the fund’s investment strategy. That is, as trustee you need to consider issues such as risk and return, diversification of the fund’s assets, liquidity within the fund, and of course, the ability of the fund to discharge liabilities.
Here are the common questions we’re often asked about borrowing in SMSFs:
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Tags: Self Managed Super Funds | SMSF | Superannuation
Posted in Business Insight, Infotelligence |
A lot of family businesses use discretionary trust structures. These have been popular because they provide both a level of risk management, separating the business from your personal assets and are also quite tax efficient.
A discretionary trust allows the trustee to appoint the income of the trust (this is typically the profit of the business) to any of its beneficiaries in the proportions that it determines from year to year. The entitlement of the beneficiary is not fixed, rather it is a decision of the trustee each year. Normally the trustee is either the key person in the business or a company controlled by this person.
In a typical family situation, Mum and Dad may be the trustees or directors of the trustee company. Using this structure business owners have the flexibility to distribute income in the most tax efficient way. None of this has changed.
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Tags: discretionary trust | Dividends | Division 7A | Family Trust | Trust income | Trusts
Posted in Business Insight, Infotelligence |
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