Home – New Forums Starting your journey Two Small Businesses GST/Tax/ABN Qn’s

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  • #973286
    millykitty
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    I currently have a small business, I am not registered for GST as turnover is under 75000.

    My sister has her own small business and is thinking of expanding it, and is wanting me to have a partnership with her in this business. It is currently operating under 75000 and not GST registered. With the expansion I am considering putting in money so it will be something like a 70%/30% share in the business. If I am to go into business with her she will then register for GST as the aim is to increase it substantially.

    My questions
    – if I am to go into business with her I will still run my own personal business. Will I need to register my own personal business for GST even though it is under 75000?
    – do we need a new ABN for the joint business (it is currently under her name only)

    Anthing else that may be important to consider? It is a bit confusing for me.

    Really pleased to have stumbled across this forum, it looks like it will be very helpful :)

    #1060772
    Blue Sky Bookkeeping
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    Hi Millykitty

    You will need a new abn for the partnership with your sister as this will be a new trading structure (I imagine at present she is operating as a sole trader?) This business will be separate from your own business so no need to register your business for gst if you continue to turnover less than 75K.

    Make sure you take the time to consider all the consequences of a partnership and put everything in writing including what happens if one of you wants out. Don’t want to put a dampener on things for you but partnerships (especially with family and friends) can get very tricky.

    I’m sure there are others out there with more knowledge than me but I hope that helps in the meantime.

    Cheers Debbie

    #1060773
    VehicleMods
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    Blue Sky Bookkeeping, post: 75129 wrote:
    Hi Millykitty

    You will need a new abn for the partnership with your sister as this will be a new trading structure (I imagine at present she is operating as a sole trader?) This business will be separate from your own business so no need to register your business for gst if you continue to turnover less than 75K.

    Make sure you take the time to consider all the consequences of a partnership and put everything in writing including what happens if one of you wants out. Don’t want to put a dampener on things for you but partnerships (especially with family and friends) can get very tricky.

    I’m sure there are others out there with more knowledge than me but I hope that helps in the meantime.

    Cheers Debbie

    See solicitor and set up a written partnership agreement. Best Advice I ever heard is write the agreement as if you were going into business with your worst enemy then put it away never to be looked at again (You do trust your partner right?). If you ever need to read it again after you start off, you will be exactly that!

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