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  • #995405
    dannymillbrook
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    • Total posts: 4
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    Hi there all

    I am currently running an informal business with 3 friends. We would like to change this and start operating on a larger scale.

    To do this we are of the belief a company structure will best suit our needs. All 4 of us will be directors and have an equal share in the company (I believe this is how it works but have a great deal to learn).

    Can anyone provide some advice on setting up a company. We don’t really know where to begin.

    Many thanks

    Daniel Millbrook

    #1201759
    Rohan@TD
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    • Total posts: 164
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    Hi Dan,

    You have access to a range of experts here. Being more specific and providing a little information about your business will help them provide you more useful answers. What specifically do you want to know? There are an extensive range of different considerations when setting up a business.

    Be careful allocating equal shares of company ownership to your business without legal protection to the other owners if somebody walks away from the business. Research ‘vested equity cliffs’.

    #1201760
    dannymillbrook
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    Thanks Rohan – Basically my friends and I are operating a “business” but in a very informal way. Currently our business is a mix of accommodation services, tours, and the hire of equipment. We are also involved in cleaning services.

    What we want to do is bring these small “businesses” under one company. We would each have equal ownership and want to know how we should go about setting this up.

    Is it simply a matter of registering a company with ASIC and conducting business through the company or are there a number of things I’m missing?

    Many thanks

    #1201761
    Melanie – MJT Law
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    Hi [USER=84877]@dannymillbrook[/USER] I think that the way you are thinking about it, is moving in the right direction and [USER=78618]@Rohan@TD[/USER] makes an excellent point. Generally speaking your accountant can assist with the best business structure for you it could be that a company structure is the right one or perhaps a partnership. I know that many small businesses don’t have accountants or advisers of this type so perhaps I can help with an introduction.

    I am not sure where you are situated but I know a company who did just what you are proposing to do about a year ago. 2 separate sole traders merging to bring better service to their clients by creating a company.

    Happy to put you in touch if you msg me.

    If you are just looking at starting up a new company have a look at http://bit.ly/2da3AV8 it’s a small business website run by the government. Further take a look at ASIC’s website, a simple call to them will help you set it up if you just want to get started with registering and leave everything else up to chance.

    Let us know how it goes.

    #1201762
    Divert To Mobile
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    • Total posts: 2,751
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    Hi Daniel,

    You can buy a company online or do it through your accountant. Its about $600 and pretty straight forward.

    Best of luck and welcome to the forum.

    Steve

    #1201763
    dannymillbrook
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    • Total posts: 4
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    Great thanks for the info!

    Can anyone recommend a business advisor in Sydney CBD. I understand it is possible to have subsidised one-on-one sessions with some organisations. Can anyone point me in the right direction?

    Also, if I set up a company and I take over a lease I have in my own name on an existing property (to provide accommodation) is it essential that the business I am involved in complies with all Council regulations? Does this have anything to do with the company or are they completely separate issues? The reason I ask is that I’m still preparing the DA for this particular premises.

    Cheers

    #1201764
    Rohan@TD
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    • Total posts: 164
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    Hi Dan,

    As a director of your company you’ll be responsible to ensure it complies with all state and federal legislation, and local council regulations. See ABLIS, the Australian Business Licence and Information Service for further information on your requirements, as well as checking with your local council (e.g. City of Sydney).

    See Small Biz Connect for the NSW subsidised program. If they can’t help you out, we’re located just outside the CBD.

    #1201765
    mariandviv
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    • Total posts: 3
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    Hi Dan

    Given that this is a business between friends, I would also recommend putting a shareholder’s agreement in place.

    The shareholder’s agreement covers arrangements for the funding, structure and management of the business. For example, what happens if there is a dispute and you don’t agree on how to manage the company, what happens if somebody would like to exit, etc.

    It is best put in place at the start because by the time you start wishing you had one, it’s too late. Also, the formal process of deciding these things at the start is great for business planning.

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