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Cancelling Company and Family Trust

Discussion in 'Accounting, Tax & Legal' started by CarolW, 15th Nov, 2011.

  1. CarolW

    CarolW New Member

    Joined:
    15th Nov, 2011
    Posts:
    2
    Location:
    Toowoomba, Qld
    My husband and I have a non-trading trustee company and a family trust. We are not operating that business anymore and it holds no assets. We both have jobs now.

    1. Is it in our best interests to disband (don't know the word) the company and trust? Thinking the costs will outweigh the benefits.

    2. How do we do this? Can we do it ourselves to save money?

    3. If we decide to set it all up again in a couple of years, will we be able to take the same company and trust names? We made them up and doubt if anyone else would take them.

    4. Do we then cancel the ABN separately or does it all happen together?

    5. We both have websites that don't earn money yet. I am thinking we would be better off being hobbyists until we near the $75K mark. Is that feasible while working jobs or would we pay less tax if we keep the trust?

    6. Is it better for us to keep the trust, have our wages paid into it, and the website $ (when they start earning) go in there too?
     
  2. Terryw

    Terryw Well-Known Member

    Joined:
    9th Jun, 2006
    Posts:
    653
    Location:
    Sydney
    1. You can wind up the company by filling in an ASIC form and paying the fee. I think you have to advertise to let any potential creditors know you are winding up and make some declarations that there are no monies owing or disputes etc.

    The trust is more complex. You will need to review the deed and see what it says about vesting.

    In NSW the stamp duty on a trust with $10 worth of assets is now $500. So it may pay to keep it open. You could just close the trustee and then the appointor (or do this first) can change the trustee to one of yourselves. Then you won't have the annual ASIC fees of $220. The trust will need to lodge a nil tax return each year, but that is easy.

    If you have any losses you should keep it open so you can utilise these in future.

    2. yep

    3. As long as no one has registered similar names you could get the name for the company again. trust names are easier and you can have something even if already taken (imagine how many Smith Family Trusts there are out there).

    4. ABN would be separate.

    5. Who owns the domain names etc? You can always transfer later or enter into licence agreements so your trust can use them

    6. Wages belong to the person for their personal services so paying into a trust would still mean you are taxed.
     
  3. CarolW

    CarolW New Member

    Joined:
    15th Nov, 2011
    Posts:
    2
    Location:
    Toowoomba, Qld
    Thank you

    Thank you so much Terry I really do appreciate you taking the time to answer to this query and it was most helpful. Have a great day :)