Business Financial Planning

For most of your working life, your super quietly accumulates in whatever fund your employer uses as default. But as your balance grows, the question of which type of super fund structure is right for you becomes more financially significant. The difference between a well-structured super arrangement and a poorly suited one compounds over decades into a material difference in retirement wealth.

Building wealth in Australia involves a set of strategies that are meaningfully different from those in other countries. Australia’s superannuation system is the most tax-effective savings vehicle available to most Australians. The 50% CGT discount for assets held for more than 12 months changes the after-tax returns on shares and property significantly. Dividend imputation (franking credits) on Australian shares allows investors to receive a credit for tax already paid by the company. And the progressive income tax system means the structure of your wealth and the timing of income can dramatically affect how much tax you pay on the returns you earn.

Most small business owners do their financial planning reactively: they look at the bank balance when a big expense comes up, check whether there’s money for a hire when the workload gets heavy, and think about taxes in June because their accountant called. This approach works until it doesn’t, which is usually when a slow quarter, an unexpected tax bill, or a missed growth opportunity makes the cost of not planning very clear.

Every dollar you spend running your business that qualifies as a tax deduction reduces your taxable income and therefore your tax bill. For an Australian small business paying a 25% company tax rate, a legitimate $10,000 deduction is worth $2,500 in tax savings. At a 37% marginal rate for a sole trader, it is worth $3,700.

People often get stumped by the term ‘Personal Services Income’. Comprehending PSI can be daunting, but anyone involved in contracting, freelancing, or small business ownership must learn its nitty-gritty. The Australian Taxation Office (ATO) introduces the concept of personal services income (PSI) to oversee how earnings from personal services are documented and taxed. PSI is most relevant to independent contractors, consultants, and freelancers providing professional or technical services. In this blog post, we will detail the concept of personal services income. Also, how it works and its financial implications will be discussed

There are several types of business structures in Australia and each has a different tax implication. Keep reading to know your business structure type and how to go about lodging your taxes under it.

Are you planning to start a new business? Do you need a means of getting funds? Keep reading to unlock several options to get capital for your startup.

Whenever economic downturns happen, most businesses and individuals tend not to survive the financial effects. Keep reading to learn how to navigate economic downturns with financial planning.