Transition from Sole trader to P/L: FTB, CSA, Austudy

[interAccounts]

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Hi Julian,

Its a real shame to see you give up on your dreams just because of a shonky accountant. People like him shouldn’t be in business and they definately don’t deserve being paid. I hope this horrible experience hasn’t affected your ability to recall everything you’ve learned in your exam.

From your initial post, it looks like your kayak business was profitable and was growing – its a shame to see something like that stop. Having your own business can give you much more family time than an employee – all depending on how you run it.

Its definately viable setting up a Pty Ltd company – even if your turnover is less than $80,000 at the moment. There are a few legal ways of transferring the income from the business to yourself if its the best option.

I’d highly recommend to reconsider your business venture once you’ve completed your exam and had a chance to breath. I’m not sure how many people are importing Kayaks into Australia, but it seems like a niche market to me, and therefore shouldn’t be given up on.

In relation to finding an accountant, I’d suggest to have a look around and find one that suits you, make an appointment with a few different ones to ask one question (more to get to know how they think / operate). It may also help if you knew the answer beforehand – you’re then testing that they know their stuff. Bear in mind that tax accountants generally charge for the time you take so try to keep the meeting short until you choose the accountant that suits you. Once you’ve chosen an accountant that suits you, then go through all your questions with them.

Hope this mess settles down shortly and you’re able to sort it all out.

[Visionlux]

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BrisbaneKayaks, post: 102424 wrote:

* Sole trader to Pty Ltd: I must admit I didn’t know the benefits/disadvantages of doing this. The accountant said, stick with being an ST if you’re earning an amount say $50000/year (part time wages plus ST income), the tax rate will be 17% as opposed to 30% for company tax rate. Pty Ltd costs money every year in fees he said.

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SNIP

He then went back to the ST to Pty Ltd issue. “Back to the ST and Pty Ltd thing, get public liability or I won’t deal with you. That’s what I tell ALL my clients who are ST. It is important and you are stupid not to have it. You wont need Pty Ltd, just Public liability. You won’t be earning much anyway, so there is no point with a Pty Ltd.”

Thanks for this info. I don’t want to hijack this thread (mods, feel free to let me know if I should just start another thread) but just this week I had been wondering “Wouldn’t sole trader with public liability insurance take care of the only major benefit that I can see right now with going Pty Ltd?”.
I wonder if any other accountants could expand on this concept?

Regarding the accountants take on your kayak business.
Frankly I think he is full of it . There are tons of examples of hugely successful businesses that have followed the china/import paradigm under the shadows of the big boys. Off the top of my head I can think of one board short company that started on ebay and are now multimillionaires and they did it under the shadow of competition from Billabong, Volcom etc. etc.
Just make a great product that people want at a great price, market it right and people will buy it.
Seriously, don’t give up because an accountant with a bad attitude told you you would fail.
To quote Ghandi…..

First they ignore you, then they laugh at you, then they fight you, then you win.

[Visionlux]

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BrisbaneKayaks, post: 102424 wrote:

* Sole trader to Pty Ltd: I must admit I didn’t know the benefits/disadvantages of doing this. The accountant said, stick with being an ST if you’re earning an amount say $50000/year (part time wages plus ST income), the tax rate will be 17% as opposed to 30% for company tax rate. Pty Ltd costs money every year in fees he said.

---

SNIP

He then went back to the ST to Pty Ltd issue. “Back to the ST and Pty Ltd thing, get public liability or I won’t deal with you. That’s what I tell ALL my clients who are ST. It is important and you are stupid not to have it. You wont need Pty Ltd, just Public liability. You won’t be earning much anyway, so there is no point with a Pty Ltd.”

Thanks for this info. I don’t want to hijack this thread (mods, feel free to let me know if I should just start another thread) but just this week I had been wondering “Wouldn’t sole trader with public liability insurance take care of the only major benefit that I can see right now with going Pty Ltd?”.
I wonder if any other accountants could expand on this concept?

Regarding the accountants take on your kayak business.
Frankly I think he is full of it . There are tons of examples of hugely successful businesses that have followed the china/import paradigm under the shadows of the big boys. Off the top of my head I can think of one board short company that started on ebay and are now multimillionaires and they did it under the shadow of competition from Billabong, Volcom etc. etc.
Just make a great product that people want at a great price, market it right and people will buy it.
Seriously, don’t give up because an accountant with a bad attitude told you you would fail.
To quote Ghandi…..

First they ignore you, then they laugh at you, then they fight you, then you win.

[Task_Essistant]

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Hi Julian,

Assuming your still on this site, and you manage to see this… (10 years on) did the rude, unprofessional accountant shut-down your business venture before it had a chance to get off the ground?

I’m not sure how I came across this thread today but I started reading before I looked at the date it was posted. If you are will to share, I am curious to know what happened. It sounded like you were onto a sure thing until you met with the accountant.

Hope your living the dream, whatever that dream may be

[Task_Essistant]

Up

0

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Hi Julian,

Assuming your still on this site, and you manage to see this… (10 years on) did the rude, unprofessional accountant shut-down your business venture before it had a chance to get off the ground?

I’m not sure how I came across this thread today but I started reading before I looked at the date it was posted. If you are will to share, I am curious to know what happened. It sounded like you were onto a sure thing until you met with the accountant.

Hope your living the dream, whatever that dream may be

[Author]

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