Business Structures Australia

If you need a business structure quickly for a transaction, Westcourt can help you create an Australian company, discretionary trust, unit trust or self-managed superannuation fund.

Our express service allows us to create business structures typically within 2 hours of a request. We do many documents electronically (some business structures like a foreign company and a self-managed superannuation fund can take longer). And our service will also include attending to the necessary tax registrations for the structure, including the ABN, TFN, GST, PAYGW, FBT, STP, LCT, WET and the other tax registrations needed for a new business structure.

While our express service works well for people in an urgent situation (like somebody about to make an offer on real estate), it may not be the best outcome. The ideal business structure for your family is where the five underlying structuring drivers are considered and understood. And identifying these drivers for your family and your business is vital so that you don’t end up with a headache or missed opportunity later on.

Income tax

The choice of business structure is a significant driver of income tax cost. If you are generating capital growth, a company might not be appropriate unless connected to a trading business (sometimes). If your business pursuits are generated using bank debt as a lever to create wealth, then a superannuation fund regulated by the ATO will not be wise.

Trading profits for small businesses (<$50m) can enjoy taxes at 25% compared to 47% for middle-sized operations and above (>$50m).

Capital gains tax

The taxation of capital varies significantly from entity to entity. And this is where the complexity comes in – capital gains are (generally) taxed the most concessional in a person’s name (or an SMSF sometimes) compared to a company.

The consideration of a family’s wealth is also important. While the small business capital gains tax concessions are often used as an “out” for company structuring options, the tax concessions generally stop where a family’s net investible wealth (ex super) exceeds $6m.

Asset protection

The use of business structures like discretionary trusts and companies can have a surprising effect on asset protection strategies. These business structures are very effective at blocking liquidators from accessing assets. So, carefully curating assets can ensure that your wealth is protected from creditors and litigation firms simply trying to scare a wealthier family into settling claims quickly.

Succession

Like a discretionary trust, many business structures will blur ownership lines away from one individual. And this unique “fluid control” concept allows for interesting and creative succession strategies where different family members have different needs.

Even if the family succession strategy is to split everything between your children equally, our creative tax strategy of a “pull-apart” company allows children to choose to keep assets together, or they can choose to separate their position away. The business structure of creating the entities is essential for succession.

Cost of administration

There is no point in coming up with the world’s best business structure for your family if it costs more in accounting fees than the benefit it brings to the family. The value a business structure brings must always be compared to the cost of the structure itself.

At Westcourt, our “client first” approach means that we will almost always choose the cheaper structuring alternative and then adopt a close watch on the structure to make sure we don’t need to adapt quickly.

If you are looking at business structuring for your corporate and family affairs, Westcourt is the best choice. Our business experience in creating a business, qualifications in the family business, proven tax leadership and commitment to independent advice ensure that you will get the best first for your family – with smart, cost-effective and considered business structuring strategies.