If you are considering starting a new business or your existing business has grown and expanded, it is time for you to think about how you might structure, or restructure, your business.
There are a few different types of business structures available to you, but before you decide which one is right for you, there are a few key factors you need to consider.
Depending on the type of business structure you choose, it may impact on how much control you have over your business and how easy it is to pass that control or introduce others into a position of control.
- Do you want complete control of your business?
- Are you going to have business partners?
- Do you want flexibility in changing who has control of the business?
- Do you want to reduce the disruption caused by the death or incapacity of a person who currently controls the business?
Different business structures will have an impact on how much tax you are paying on the business income earned.
- Do you want the flexibility to distribute income to someone else (for example a family member) who is in a better position to manage the tax on that income?
- Are you concerned about having to pay tax on your business income at a rate higher than the corporate tax rate?
The start-up and ongoing administrative and accountancy costs will differ depending on your business structure.
Different business structures offer the ability to provide a level of protection for your personal assets should your business get into financial difficulty or legal action is commence against your business.
- Do you want to protect your home and other personal assets if a claim is made against your business?
Types of business structures
The four most common business structures include:
- Sole Trader
To find out more about each of these structures, please contact our commercial team on 07 4671 6000.
In our next bulletin we will discuss being a Sole Trader.