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Company Questions

Discussion in 'Accounting, Tax & Legal' started by vandalic, 28th Aug, 2008.

  1. vandalic

    vandalic Active Member

    2nd Jan, 2007
    Brisbane, QLD
    To company owners and/or accountants I wanted to get your high level feedback on if you think this situation would be better suited to a company structure or just operate as a sole trader with ABN, etc.

    I'm currently a PAYG full-time permanent employee of a company. I am looking to increase my income on the side with a bit of online business which I'd say would be minimal in the first year... perhaps 5-10k?

    To allocate associated income and expenses accordingly and given the small size should I just setup an ABN and just report a yearly BAS? I am in the 40% tax bracket at present though perhaps the associated fees with setting up a company may not be worth my while given the small income? The legal entity seperation and personal asset protection is a plus though...Any other way to protect personal assets if I was to just use an ABN?

    Is there a variety of reporting required depending on the size of the company? i.e. With minimal income could I just do a simply yearly financial lodgement?
  2. bcruik

    bcruik Member

    24th Jul, 2008
    Brisbane, QLD
    What type of risk does the new 'online' business pose?

    If it could possibly bankrupt you financially than you might find a company is the way to go, otherwise getting getting an ABN will be much cheaper :)

    Keep in mind starting up a company is cheap (about $500-$800), with yearly on goings of about $700-$1500 (getting accounting to lodge return + annual ASIC fee)...

    Make sure you know your legal obligations of being a company director etc...