Home – New Forums Money matters Starting pty ltd company by yourself

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  • #978847
    endlessink
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    Hi everyone,
    I was just wondering if any has applied and been successful for pty ltd by themselves and not through an accountant? Is it do-able? We are trying to keep our overheads as low as possible at the moment, and from looking on the net you can apply by yourself, it is about $400 cheaper to do it this way. Am I crazy for considering this?
    To the accountants out there, is there an added advantage (aside from saving me time) from doing it through an accountant?
    Thank you very much for any answers you may have!

    #1109931
    Chris Brodie
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    Hi,
    A couple of things to think about. Yes you will save money in the set up cost, but remember that a company is a legal entity which you will be running a business through, so you need it to be established correctly. Yes you can do it yourself via ASIC, but they will take no responsibility for any mistakes made and any errors will be on yourself. Another alternative is to use a firm that establishes companies and they will charge you the ASIC set up fee plus a fee for their time depending on the type of company material you request. A quick web search will help you find many firms who do this work.

    Another question is why a company? You must think your business has strong potential that you wish to structure it via a company, but you need to consider if a company is the best structure. Take time to get advice on the best set up and structure for your business. You may save money now, but end up paying more costs later because you could have established your business in a better structure from the start.

    All the best, but remember to invest now for the future,

    #1109932
    AgentMail
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    Get an accountant to do it, and spend the 10+ hrs you would have lost applying, learning, correcting etc. to make money in your business.

    #1109933
    yourvirtualboard
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    It’s a good idea to have this discussion with an accountant or other qualified professional if you were looking at deciding which structure to use. If you are absolutely sure (and you are clear as to why) that it’s a Pty Ltd you want then self-registration is not the hassle some might think. There are online registrations available that register with ASIC and provide all the statutory documentation required to establish as part of their package (some law and accounting firms actually use this service), and it takes as long as you need to fill in the online forms.

    #1109934
    JacquiPryor
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    I was just wondering if any has applied and been successful for pty ltd by themselves and not through an accountant?

    Hi Endless Ink,

    Yes I did apply for my Pty Ltd myself rather than through an accountant and yes the application was successful. But before doing so, I went and saw an accountant to get the pros & cons of operating a Pty Ltd vs another type of structure… my accountant is pretty reasonably priced (I think) so I paid $100 for that consultation in addition to the $426 ASIC reg fee. Plus, I have a general working knowledge of companies, ASIC and the forms through what I do for a living so that certainly helped.

    If you’re not familiar with the forms and legalities you could inadvertently make a mistake when registering the Pty Ltd, which would be avoided by using an accountant or corporate services company to begin with. If you know it’s the Pty Ltd you’re definitely after, a corporate services company can assist in the set up and registration for you. For example, Shelcom Corporate Services, (Flying Solo member) as can many of the accountants here.

    #1109935
    ABC
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    Definitely worth considering the pros & cons of business structure BEFORE you take any action. Recognise too that as a pty ltd, while your tax rate may be lower, there are greater requirements for reporting (accounting fees, lodgment fees and audit fees). In addition, you need to be very clear that the company’s assets are the company’s and not yours eg its a business account etc.

    Most Accounting or Business 101 books or websites will be able to give you a quick summary of pros & cons.

    Jacqui’s suggestion about seeing an accountant first even if you (a) decide pty ltd (b) doing it yourself is wise – you will get advice that are ideally suited to your situation and not the generic. S/he should also be able to tell you what to watch out for and what not to do. Ask lots and lots of questions to make sure you have a clear picture.

    #1109936
    James Millar
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    My view.

    Bootstrapping and being resourceful is very important but there is a line at which this can become counterproductive. Micro managing every single function of your business (particularly those that are one off events like incorporation) is probably not the best use of your time.

    If your business and financial model is that tight that you need to spend hours of learning, buying books etc to get an incorporation and structure half right then perhaps you should revise the plan. Sit down with your accountant and ask them for an objective assessment of your financial model or forecasts for your business. It’s highly likely they will identify some interesting issues for you to consider.

    Helping build better businesses and better lives with expert financial and taxation advice. [email protected] www.360partners.com.au 03 9005 4900
    #1109937
    Vilson
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    Hi there,

    we use online services for that and it is very straight forward.

    Please Go to http://www.trustdeed.com.au/

    Even though my background is in IT, i have done it my self. Simple and only 20 Minutes.

    Hope it works..

    Create Online Test or Quiz on ScoreBell
    #1109938
    AGMBris
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    Hi

    I think the consideration firstly, as others have mentioned, is the Pty Ltd entity the correct set up for you?

    Consider the future of the business and where you are going. What are your personal goals? Will there be a need for tax benefits provided by a company V the admin costs to maintain? Do you need to guard personal assets in some way or in the future?

    And yes most definitely you can create it online, we did and although I have a background in accounting, it isnt really needed as long as you get the legal documents required. Generally the constitution will just be a standard wording and the same with the other docs like the memo and articles and the share registry/certificates etc.

    The benefit you get with an accountant is fwd thinking and advice on future requirements when creating a company, there may be adjustments needed to the legal documents at incorporation and that would need more professional advice. But if you are just a single director/single shareholder creating a trading company, it really isnt a problem as long as you have the base documents that can always be amended later if required.

    Good luck!

    #1109939
    travelmaster
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    Hi,
    my first reaction is, if we all did everything ourselves none of us would exists, there would be no FS,

    my second reaction is, with a thing like setting up a company surely it’s something best left to professionals.
    or maybe it’s just me

    #1109940
    endlessink
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    Thanks everyone for your time. The reason we want pty ltd is for the legal liability. I dont want any of our personal assets to be affected somewhere down the track, so I am trying to think ahead.

    I am lucky in that I have plenty of time to work on getting the business going so spending the time on the application is not an issue. But as Jacqui suggested, I will see an accountant beforehand and get their thoughts/opinions. I am currently paying for all sorts of professionals to get this business going (oddly enough not an accountant!), so am trying to diy as much as possible, but I will spend the money if need be. I just wanted to hear everyones thoughts :)

    An accountant quoted me $295 for an hour consult and then $1440 for the pty ltd application, and another $500 for asic annual fee and then $1100 for annual tax man stuff. Is this about average? Thoughts on this?

    Thanks for all your posts, very kind to share your advice

    #1109941
    yourvirtualboard
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    endlessink , post: 122640 wrote:
    An accountant quoted me $295 for an hour consult and then $1440 for the pty ltd application, and another $500 for asic annual fee and then $1100 for annual tax man stuff. Is this about average? Thoughts advice

    Talk to another accountant or two. It costs a third of what you’ve been quoted to register. ASIC is about $226 and I’ve never been charged more than $900 for my annual return and the odd phone call. There are a few on FS that would be able to help.

    #1109942
    JacquiPryor
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    The reason we want pty ltd is for the legal liability. I dont want any of our personal assets to be affected somewhere down the track, so I am trying to think ahead.

    There may be other options to even further limit liability – purely as an example, a Trust with a company as the Trustee. This is why we are all suggesting to get the advice first to make sure that a straight Pty Ltd is right for you and best to keep your assets safe.

    An accountant quoted me $295 for an hour consult and then $1440 for the pty ltd application, and another $500 for asic annual fee and then $1100 for annual tax man stuff. Is this about average? Thoughts on this?

    I would say this isn’t unreasonable, but, you could probably find lower fees for an initial consult and Pty Ltd set up. You can receive/pay the annual fee yourself, which would save on that fee. The $1100 tax return ‘stuff’ doesn’t seem entirely unreasonable to me.

    #1109943
    James Millar
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    Its clear that the actual process itself is not super difficult. The value is really in the IP / knowledge that an accountant or lawyer brings to it. It comes down to risk management. If you are intending on starting a genuine business (not just self employment) then getting advice on structure is a must.

    Helping build better businesses and better lives with expert financial and taxation advice. [email protected] www.360partners.com.au 03 9005 4900
    #1109944
    Chris Brodie
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    Hi,
    In regards to your quoted accounting fees, there are ways to reduce the accounting costs eg. I get my clients to pay the annual ASIC fee directly (ie. no mark up!). If you are in Melbourne and would like to discuss your accounting needs further (and costs involved) then please feel free to PM me. All the best.

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