Building The Right Business Structure Without The Jargon

Choosing a biz structure shouldn’t feel like spinning a wheel and hoping for the best. In this episode, Aly G and Leethal Lee break down the tea on sole trader vs company vs trust, minus the boring textbook vibes.

We’re talking:

✨ The tax traps that catch first-time sole traders off guard (hello, double whammy tax shock 👀)
 ✨ Why the ATO has been tightening the screws on payment plans and remitting general interest charges
 ✨ How to avoid sliding into a totally preventable debt spiral
 ✨ What “asset protection” actually means in real life
 ✨ And how your structure impacts funding, privacy, and future growth

Then we get real about company life. Yes, there’s the capped corporate tax rate and shiny “separate legal entity” perks… but there are also very real director duties that ASIC and the ATO absolutely enforce. And if you’re selling your own skills? We unpack the personal services income rules that can wipe out that dreamy “company tax advantage.”

Trusts? Oh, we go there.
Discretionary distributions. Capital gains tax concessions. Flexibility. Wealth-building power. And the ATO’s very clear position that cash needs to match the paperwork.

We share the war stories, family law battles, unexpected losses, liquidations, shadow directorship drama, messy money flows, and the lessons that come with them.

We break down:
 ✔️ Why the modern “company + trust shareholder” stack is popular
 ✔️ When that setup doesn’t make sense
 ✔️ What you’re really signing when you become a director
✔️ How to balance tax savings against legal risk
✔️ And how to protect yourself from coercive decisions

We wrap with a no-fluff setup checklist:
 ABN or ACN?
 Business name?
 GST?
 Separate bank accounts (non-negotiable)?
 Smart software?
 Insurance?
 Record-keeping that actually scales?

If you’ve been overthinking your structure or low-key avoiding it because it feels confusing, this one’s for you.

Make sure to follow the show and join us with bold moves, big wins, women leading the way. 

Here is a handy checklist that you may find useful

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Transcript

SPEAKER_01 0:11

Welcome everyone. Today we're talking about choosing your business structure without the jargon. Now, yes, this could potentially be dry. This is the stuff that we love though. So choosing a business structure is one of those really early decisions that may potentially feel a bit boring on the surface, but quietly shapes everything that comes next. It affects how you pay tax, how you protect your assets, how you grow, how much admin might need to follow. So there are so many things here. It's a bit of a buffet. So we're gonna try and keep the jargon and the accounting chat really low. But the good news is that there's no one real size fits all. Um it's so dependent upon your individual circumstances. So maybe we'll start at Hi Lee, by the way.

unknown 0:58

Hi.

Sole Trader Basics And Tax Traps

SPEAKER_01 1:00

Um now, this is our bread and butter day in, day out stuff. This is, you know, after you've had that business idea, this is usually that next conversation that we have. So Lee, do you want to kind of start us off?

SPEAKER_02 1:13

I guess the first place most people go is I'm just gonna be a little sole trader. Yeah. I've actually already got a A B N because I did it online. Yep.

SPEAKER_01 1:21

So And look, it's the cheap, easy option. It is.

SPEAKER_02 1:24

It's the the starter out, you know, you've got an ABN, woof, and away you go, you're a business.

SPEAKER_01 1:30

And look, you know, you if you're a personal services income business, as in the services derived directly from you, it's it's most probably a pretty good structure.

SPEAKER_02 1:38

Yeah, and I guess it's for people that are out there pro maybe contracting. Yeah. A lot of medical professionals end up in that. Um or if you're just doing sort of small stuff and it's starting out um, or you had to get it, some people have to get an ABN as a requirement.

SPEAKER_01 1:56

It's fine. They keep costs low as well, so you don't need an extra set of accounts and tax returns.

SPEAKER_02 2:01

It's the most simple sort of structure getting around. It kicks you off and away you go. Um, like I said, get an ABN and all of a sudden you go from being a person to a business.

SPEAKER_01 2:09

And I think the highlight here, and this is where I think a lot of people get trapped, is they get their ABN and they start earning income, and but they're not paying the tax on the income until you've lodged your first tax return with that in there. The double whammy of tax is what I like to call it.

SPEAKER_02 2:20

Yes, it is we it's the first conversation I have with every person that becomes a sole trader, is I just want you to know you're not currently paying any tax, and when you lodge your first tax return, you'll have a tax bill, and then just for the fun of it, the HL will ask you to pay next year's at the same time. I know the shits and giggles that we have. So you get it like the double whammy. Yeah, so you it you get to pay um so for the first sort of 12 months, you're like, Whoa, this is so good. I'm getting so much money, I'm not paying any tax, and it's all in your bank account, and you're seeing the money in there, and you're like, I'm gonna spend it because I've got it.

SPEAKER_01 2:56

And this is the example I give to people. Let's say you start your business one July, you know, your first tax year is 30 June the next year. You don't need to, if you'd go through a tax agent, you don't need to lodge until 15 May the next year, right? So you've literally nearly got two years and then you have to pay the last year, pre-pay the current year, and then head into the next year. And if you haven't hived off tax, this is where people get into the the cycle, which is so hard to break. It's like it is it's it's the bit where we see people break in business.

The Double Whammy And ATO Pressure

SPEAKER_02 3:27

And I think I said it in the last episode. My favorite people are when they come in and you're I'm starting a business and I've already started putting 20% away for tax, and I just want to make sure I'm like I love you. And then you talk to people and like, I've been in business for three years, I haven't launched a tax return, I haven't paid a cent. And you're like, I do not love you.

SPEAKER_01 3:46

You are in for a world of pain, my friend, and it's not my fault, and it's not your prior accountant's fault.

SPEAKER_02 3:52

No, um usually they don't have a prior accountant, they've not thought to get one. Um, but yeah, it and the we'll put it out there, the ATO are hot on us at the moment. They are not letting us negotiate to repay ATO debt, they do not represent they don't want to remit general interest charges. They're not happy with us at all. Um, and they're being very, very, very, very difficult.

SPEAKER_01 4:19

But you know what, rightly so, because this is where people that are doing the right thing and paying their tax shouldn't you know they should be able to do that? These other people that aren't paying their tax, you know, are maybe at a price lower, or you know, they're getting a better lifestyle because they're not paying their tax. I mean, that's the outcome. And the tax system is innately fair, and maybe this is another podcast episode because I know that's a tax professional. Um, everyone pays the same amount of tax, it just depends on your income. Yeah.

SPEAKER_02 4:45

And so it is important that so, and that is a trap of a sole trader, is all of the business income comes into your personal tax return. You are personally liable for it. In that year, you can't defer it. From a little from a job, or if you've had a capital gain, or you've sold something, or you've got shares, or anything like that. It all just goes into the same pot. It's not separate. Um, and you're paying tax on all of your income. That's right, and you can't really control it. There's not a lot of tax planning you can do as a sole trader, not a lot of deferring, or or battery. It is what it is, my friend. It all goes together and away you go.

SPEAKER_01 5:26

So you don't have the admin costs, and you also don't have the asset protection. So you're a bit liable there.

SPEAKER_02 5:33

Um, and an interesting one that I have only recently started thinking about and it's come to my attention, is if you're a sole trader, your name, your personal name is on the ABN register. And so even if you've got a business name, even if you're Lee's Lollies or whatever you want to be called, people can work out who's your actual legal name sits attached to your ABN, which is a searchable, very searchable public register register, and people can find you.

SPEAKER_01 6:04

Yes, and we find this with medical professionals a lot.

Privacy Limits And Asset Exposure

SPEAKER_02 6:06

Um yeah, you can do an application to hide it, but that you know you can take a bit of time and it will sit out there and it's pretty findable anyway. So you if you're in an industry where you don't want people to be able to just look you up willy-nilly, yeah, there is a reason not to be a sole trader. Yeah. Um, and that's for your own personal identity protection.

Company Pros, Cons And Control

SPEAKER_01 6:33

And I I that's such a relevant point. And I think so for those people that potentially don't want to be a cell trader, what other alternatives are there? Um What's hot to trot? Uh Instructural.

SPEAKER_02 6:45

In structural I'm um I'm going to show my age and say that back in the day it would have been a trust, but the ATO do not like trusts much at all. And so if you're running a business, the real the other option for the most part is a company. Yeah. Um, it's got a lower tax rate, um, 25% for a period of time. It's capped, um, so you can control it a little bit. You can retain the earnings, yeah. You can as long as you're not pulling all the money out to spend it personally.

SPEAKER_01 7:21

And that creates some Div7A and look, that's a whole other topic.

SPEAKER_02 7:24

It is, it's a more um controllable structure, I guess. Uh, as we call it, it's dil you can delay to delay, yes. Um for a period of time. Uh yeah, we like to call it kick the can down the road down the road. Kick the tax can down the road. But a company, and that gives you, like I said, that's its own separate legal entity.

SPEAKER_01 7:45

Yeah, so you get some level of asset protection above and beyond. It's like a bit of a it's like a wall between your personal assets and ASIC have become a lot tougher on it. They have. And also if you're giving director guarantees, you're kind of dropping the ball there. But and also if you've got director loan accounts. Yeah.

SPEAKER_02 8:01

Um if something goes wrong in your company, you can personally still become liable. Like I said, ASIC have sort of cracked down and there's things called director penalty notices. And so if you're doing the right thing. If you're doing the right thing, it's fine. And it's so it's its own legal entity, it pays its own tax, so a bit more compliance um costs because it is another tax return and another set of accounts you have to lodge. You have to keep lodging things with ASIC each year to keep your records up to date. Um but it's its own name, so whatever your name doesn't necessarily have to be out there into the public with it. It can be called whatever you want, provided it's not already taken. Um there's a cost to setting it up, which is a couple of thousand dollars generally. Yeah. And um, so it is more cost prohibitive. Yeah. It's because it's its own entity, it has to have its own bank accounts, and that can be so there's a bit of admin behind it. Yeah, there is admin. It can come a little bit tricky with the bank because if it's fresh and new, it's got no history, it means that it makes it a little bit more difficult if you're trying to get funding, which we've talked about before. Um, where you where you couldn't necessarily get funding for all in or even a credit card. But yeah, so it's it's its own self, it's got it's gonna pay its own tax. Um, it its assets sit within the company.

SPEAKER_01 9:25

Within a the company. Yeah. And there are ways to remunerate yourself. I actually we do have a great blog on our website um around how to remunerate yourself in a company. But the other thing about a company is it has directors. It does. Um and those directors they're the bosses. They're the bosses, but they also have um a certain level of um well, they have to really do the right thing. So there's obligations for them as a director that you cannot in any way claim ignorance, like you have to do the right thing by the company.

SPEAKER_02 9:57

Yeah, you do. And it it would be wise to do some research and read the case. There's a course there should be a course. There should be. Um, because you do, like I said, you do become liable in the end. The AT uh the ATO and ASIC don't take um ignorance as a as an excuse.

SPEAKER_01 10:14

No, they don't.

SPEAKER_02 10:14

Um, you are required to know your obligations as a director and what you should and shouldn't be doing, and that includes financial. Like I don't know is I didn't know is not an excuse. No, it is not ignorance is not bliss. No, no, none of it is personal director liability. Um you are assumed to have researched or have the ability to go find the information if you're not sure. So um that's a company. The other thing with a company is has shareholders. It does, it has shareholders, so you can So there's the people that basically own it. And for most small businesses, the director and the shareholder is the same person.

SPEAKER_01 10:51

Lately, it's a you could have a trust in the company. You could, but let's go for it.

SPEAKER_02 10:54

You're at the end of the trust in the end.

Director Duties And Personal Risk

SPEAKER_01 10:56

And so the purpose of the shareholder is if there's retained profits in the company, you can pay out dividends to the shareholder, which potentially is an individual, or if you're doing some pretty handy tax planning, it could potentially be a trust. And maybe that's where we can start to talk about a trust.

SPEAKER_02 11:11

Yeah, I I will say about a company, I was gonna say if you're a um sole, like just a person providing personal services, and you're a company, there are special rules, and yes the income comes to you.

SPEAKER_01 11:27

It does, it's still like and look, there are some people that make you be a company, and there's a reason for that is because of super and retention.

SPEAKER_02 11:33

And so the bonus, the the benefit to the person wanting you to be a company is that when you are paid or remunerated via a company, you are never considered to be an employee under the the leave, like the fair work and super rules, so you wouldn't ever be questioned as to whether you're an employee or a contractor. It has gone through our two audits on that, and it's it's it's cut and dry. You are not an employee if you choose to be remunerated through a company. So they don't have to worry about you coming back later and asking for leave and for super. That is why most people, if they're stressing that you should be a company when really you probably should be an employee, that's why. And if you do that structure, it's called personal services income. And you don't get the benefit of it, and you don't get it all just any profit will come out to you and you'll pay tax on it each year. Similar to a sole trader. As a sole trader, effectively. So I think we get this question a lot, and it they're like, oh, I get lower tax, I get this, I get that. No.

SPEAKER_01 12:33

No. And that's one of the first things we go through is is this personal services income? Yeah.

SPEAKER_02 12:38

And that's a whole different story. Yeah, that's a whole different thing. They do have some really good resources and workflow. Yeah, they do, they work through it. So you can go and look if you want.

SPEAKER_01 12:47

So it depends on the number of clients you've got and whether you use your own tools.

SPEAKER_02 12:51

And whether you've got employed, if you've got employees that can do the job for you, that generally rules you out straight away. But if it's just you and you rock up nine to five, um as you pay buttons, your mistakes, you know, like yeah. I always say if you smell like an employee, you probably are. Smell like a little employee, look like an employee, you probably are one. Yeah. Um and that's where PSI comes in. Yeah. So just disclaimer on that, I guess, is just because you're a company doesn't always necessarily mean you'll be treated tax-wise as one. They the ATO are pretty on to all their tricks these days.

SPEAKER_01 13:23

No, honestly, being an accountant 30 years ago, it was like cowboy territory was so wonderful.

PSI Rules And Contractor Myths

SPEAKER_02 13:28

Um they know everything. Yeah, they do. They really do.

SPEAKER_01 13:33

And let's not talk about the amount of information they actually know right now.

SPEAKER_02 13:36

But anyway, there's not much that can go get past them these days. No, no. Um so let's go back to this um a trial.

SPEAKER_01 13:42

Oh sorry, hang on one sec, maybe we'll just ch throw to our sponsor and then we'll come back in just a moment. This episode is sponsored by Ignition, the software built for accountants by an accountant. Simplify proposals, automate billing and collections, and streamline your workflows. Save time, make money, get Ignition. So back to being a trust. A trust, yeah. Now you can trade as a trust, albeit have a trust as a shareholder.

SPEAKER_02 14:08

So a trust is actually a really good investment vehicle, I suppose, is where we see it most. And that's why we would normally set it up as a shareholder of your company. That means that you can receive the uh dividends from your company, and then you've got a bit of because it's a discretionary trust, directly. They do have to be passed out each year. Can't retain earnings in a trust, they must go out each year, but you'll generally have discretion based on what is in your trust deed, which is the document that governs your trust. Um, family members. Yeah, and so it'll say, like, you know, kids that are 18 and over. Allie, Ali's spouse, Ali's parents, Allie's kids, um, anyone that Allie is remotely wanting to.

SPEAKER_01 14:58

And the purpose there is to push income to a lower tax bracket.

SPEAKER_02 15:01

Yeah, and just manage, I guess. It's about managing it in that way. We we get a bit of like I said, it's a discretion, so you can choose who each year is gonna have the best tax position to give the money to. That being said, the ATL got us again. I know. Um, and there are rules now around parking to distribute too, yeah. The cash has to follow. Business income, um, yeah, the cash has to follow, basically. Or the person has to have been working within the business to justify the remuneration. So if you're giving them the money, so if it's your spouse, it's fine, you know, you're sharing the money. If it's your kids, it's a little bit more tricky. If you're still paying for them or or giving them money along the way, you can justify that. But it the ATR or ATO are sort of onto us. I think they're just really the fun police.

SPEAKER_01 15:59

Oh, they're just closing every loophole.

SPEAKER_02 16:01

Dang it. They think we're doing worse things than we are, I think.

SPEAKER_01 16:03

Yeah, but it's a bit of a Go for the high wealth individuals that are taking their Go for the international company.

SPEAKER_02 16:09

I know, and the transfer pricing. Um, yeah, so they're like trust is the most flexible, I guess, in terms of tax planning income out. But there is a cost. There is. Again, there's a cost to set it up, um, and that is a little bit less than a company. Yeah. And again, you'd have to do a separate tax return, which if you're operating through a company and then you have to do another trust sanction, a little bit more cost again.

SPEAKER_01 16:33

Yeah, bit pricey, but very good from a long-term scalability growth protection point of view.

SPEAKER_02 16:39

Yeah, a good tool to grow wealth in.

SPEAKER_01 16:42

Yeah. Yep. Also has some really great capital gains tax concessions at the moment. You can get a 50% capital gains tax tax. Companies can't. No.

SPEAKER_02 16:49

So we don't tend to accumulate assets like capital assets buildings. If we're buying the office building or we're buying shares or anything like that, we wouldn't generate in a company.

SPEAKER_01 17:00

Sol traders and trusts get the and some super funds get some capital gains tax concessions.

SPEAKER_02 17:06

Of course, everyone's little disclaimer, it's a classic accountant. Everyone's circumstances. This is never a difference.

SPEAKER_01 17:12

Consult your accountant.

SPEAKER_02 17:14

I actually have a couple of clients from a company. We are building wealth in a company because that suits them. But it's a very unique situation. It is unique, yeah. And we've done a lot of research and a lot of sort of background on that as to why that might work.

SPEAKER_01 17:27

But you know, and the other thing about a trust is it needs a trustee who controls it. Yeah, and so that is where it could be you or to give a little bit of with a low-risk investment vehicle, potentially that's okay.

SPEAKER_02 17:40

Yeah, and if you're actually operating through a trust, often we'll put in another company.

SPEAKER_01 17:45

As a trustee.

SPEAKER_02 17:46

As a trustee, just to to give a little bit of you know, third-party interference in there. Again, sometimes you'll wonder now with our six rules whether that really works.

SPEAKER_01 17:58

Um Well, I think if you're if you to if you if you're towing the line and you're not doing anything fraudulent, I think it works. Yeah. If you're paying your tax on time and all the doing all those things, I think it works.

SPEAKER_02 18:06

Yeah. So that's I guess a trust. As we've kind of looked at it as an investment vehicle, you can trade through a trust still. And if that's what you want to do.

SPEAKER_01 18:16

Interestingly, I reckon about 10, 15 years ago, maybe more, a lot of people traded through trust.

Sponsor Break: Ignition

SPEAKER_02 18:21

Yeah, most of my clients were a trust back in the day.

SPEAKER_01 18:23

And so you might still see them pop up, but they're older businesses. Whereas these days, the most common structure I see is a company with a trust shareholder. Yep. That if you were starting out and you came to me and you said, What's my ideal structure?

SPEAKER_02 18:35

Yep, I would say company with a trust shareholder, um, and you as an individual trustee.

Trusts For Flexibility And Wealth

SPEAKER_01 18:40

And I just want to disclaim here that, you know, the rules do change and the ATO and the government do kind of get their knickers in a knot sometimes about particular things. So you will see that that structures do ebb and flow over time. And it's not that your accountant has done the wrong thing. They've done it based upon what was the best at the time.

SPEAKER_02 18:57

And your circumstances change. So this is where we might. You know, when you're starting out, no one wants to think of what is the worst that could happen. But we do. We've seen it. Yeah. Unfortunately, we've seen all the bad things and we've we've got the horror stories to share.

SPEAKER_00 19:14

Yeah.

SPEAKER_02 19:14

So I think you do need to be mindful of what else is going on. I know we've had this conversation a few times where a husband and wife maybe have come in and they're looking at a structure and and we're looking at them going, we don't think they're gonna last. They don't seem to like each other. Um and so in the back of our head, we're going, we need to make sure this is structured in a way that is going to be best if a divorce happens.

SPEAKER_01 19:48

Yeah, and look, I've got some experience here. Um I am not divorced, so I'll the the the family law, if if I can just take this, because I think it's a really important part because even estate planning is a certain planning as well, obviously. And that's where you get a lawyer involved as well.

SPEAKER_02 20:04

And I and I've had unfortunately to deal with um early death of a like uh the the the man, the husband, there was an accident, he died, they were running a business and it was just horrific. Um and because she wasn't part of the business, it was really hard for her to then step in and cover that. Yeah. So there was a lot of um there we just wasn't set up to stay working. Um because it was an early and you know, no one expected it, and it was an it was an accident, and it it like I said, it was just horrific, and some of the things we had to say and do were so hard, and it was a long time ago for me, and I was really young, and I was way out of my depth. Yeah, but it it was a learning experience that you do have to, and I I come from a um my father died when I was nine of a a sudden heart attack, and he was only 44. So I understand that the worst can happen.

SPEAKER_01 21:09

Um and it has such an impact, and you know, you can do this at a really difficult time in your life.

SPEAKER_02 21:15

And the last thing you want is the tax to come back and bite you. So it is important that we we do it right for what's right now, but we also do it right for what might come.

Distributions, Cash Flow And ATO Scrutiny

SPEAKER_01 21:25

Yeah, and I think from a family law perspective, I think just a really big overview. Family law actually looks through all, it looks through companies, trusts, structures, um, and so all of that kind of goes in the kitty. Whether you're a director or a shareholder, it all of it comes into the asset pool at a particular value, um, usually done by valuers, and then um you know you agree your percentages from there. Um, and then you've got to, if you've got a trust, for instance, you've got to try and get this other person out if you've been distributing to them, or if they're a director shareholder, you've got to get them out. And you do have to consider division 7a, which is the director loans, you've got to consider the Tax consequences, any capital gains. So, um, from a family law perspective, um, it overarches and has um more see-through than any other. So just because you've got a company doesn't actually mean you're protecting it from your spouse at all. Um, so and it's not and you can't, and you also can't rule from the grave if we're talking estate planning. So there are certain things that we can do, just certain things that we can't. So just be mindful of that, I think. Yeah.

SPEAKER_02 22:26

And I remember having a bit of a weird conversation with my brother-in-law, and they were talking about, you know, they're gonna buy investment property and how you know maybe it was best to put it just solely in my in like my sister-in-law's name for tax purposes. And I was like, Yeah, like that that works for tax. I was like, but I don't want to assume that like look, I'm not judging you when you're married, but you know, that's it. It doesn't protect you from family law, but it is a risk, and and it just makes that family law more complicated. It does. And if you know, and it also means that just at any old time, she could sell it. Yeah, without put him having designed anything. Do you know what I mean? Like even without a divorce. Absolutely. You you're giving over control.

SPEAKER_01 23:09

So is that worth the tax benefit, potential tax benefit? And the other thing I have seen in a real life example in a deregistration was there was a common thing that the wife who didn't have a job, and I mean this changes now, you know, had a low-risk job, had the house in her name, yeah, and then the director um was just the sole director in a company that had a high risk.

SPEAKER_02 23:31

Builder normally, normally, yeah, because it's a high risk followable.

SPEAKER_01 23:35

What happened was the the liquidator came in and said, Who's been paying for the home loan? And it was paid through the business.

SPEAKER_02 23:40

And they're like, Well, that's who owned it.

SPEAKER_01 23:42

That's who Yeah. So you've got to be super careful that from a tax perspective, you might be doing things, but you actually has to be legitimate and follow through. So the wife then actually needs to pay the mortgage payments, right? So there's so much look through now with liquidation.

SPEAKER_02 23:57

What would happen with that is if the wife was involved in running the business and making decisions, she would be considered a shadow director. That's right. And she would be considered liable as well.

SPEAKER_01 24:06

So you just so on paper it might look great, but you've actually got to think about the functionality and how it's actually working in real life. Yeah.

SPEAKER_02 24:13

And like I said, it is a risk. And I we we have this conversation a lot, right? About um, I just want to save tax. I want to do whatever saves tax. It's not always the answer because you are opening yourself up to other risk. Absolutely.

SPEAKER_01 24:28

And just because today you never make a decision just for tax.

SPEAKER_02 24:32

No, just because today is okay, doesn't it? Doesn't mean tomorrow will be you just don't know what's around.

CGT Concessions And When To Use

SPEAKER_01 24:38

And we've been we've been around long enough to see some absolutely dastardly things happen.

SPEAKER_02 24:43

And and I think like if we go back to the women in business thing, you've got to protect yourself and think about your own interests. Don't just do it because it suits your spouse or because your accountant said, Well, that's your role as the woman, and you just get railroaded. Like the amount of women we see who are on the other side of divorce, yeah, and they'd no idea. And they didn't know what was being lodged on their behalf or not lodged, um, and what structure they'd been put into and what they were signing. Oh, makes me feel sick. It's frightening. Don't do it, and you really are responsible for educating yourself. And in family law, that doesn't fly. No, you sign and that's your responsibility. I I go back to that really know what you're getting yourself into and advocate for yourself because just because today is all roses doesn't mean but if somebody's asking you to do something that you don't feel comfortable with, that's coercive. That's made okay, and if you don't understand, don't sign it. Don't do it. Speak to the accountant. Yeah, and and find someone that can explain it to you that you trust that will explain it in a way that you do understand. Um, because if you're being coerced into anything, it's a problem. Yeah, and like I said, just because it's good today doesn't mean it is, and you do need to protect yourself. Um, so that's probably the only other thing I would add with the structure is don't do it just to save tax.

SPEAKER_01 26:15

Now, this is going to be a longer episode because there's so much to get through. Because once you've decided on structure, there are, I guess, a few key important things that are applicable to all businesses that you kind of need to get yourself on board with. And one of those is, and you mentioned before, was an ABN.

SPEAKER_02 26:28

Yeah, like just the I guess we've got a little checklist that we send out. Yeah, we do. Um go onto our blogs. Yeah, um, it's just uh follow your kind of tick off. So it's you know, you've got to register for an ABN. Have you heard about TFN's business names? Companies have what's called an ACN, so you've got to be registered with ASIC. But yeah, business name is a big one that we people have thought of a business name, they've gone and got a website and socials, and then it they've not registered the business name and it's not actually available and someone else has got it. Or I have seen where they've started the socials and some sneaky person has taken the business and they're now trying to sell it to them at a profit.

SPEAKER_01 27:06

Yep, that has happened. The other thing is if you're earning over more than$75,000 in turnover, you've got to register for GST. Yeah. And if you employ people, pay as you go.

The Common Modern Stack: Co + Trust

SPEAKER_02 27:15

Yep. And so that means you're lodging Basses, which means you need a lot better record keeping, um, which gets us back to where we started, where we're, you know, start how you mean to continue. So systems zero. Make sure you got your bank accounts set up, separate bank account, separate bank accounts and credit cards. Even for a sole trader, separate bank accounts. Absolutely.

SPEAKER_01 27:36

Work out your payment terminals like your PayPal's or your stripes or your afterpass. Um insurance.

SPEAKER_02 27:42

Yeah. Oh, yeah, insurance. You know, you never know what's around the corner. What buses are coming for you. Um so yeah, insurance, just the little things. Uh registering domain names. Yeah, getting the social handles, um, just a couple of those things that you kind of forget. Uh like we've just done one now, obviously a much bigger business, but payroll tax. Yeah. Work cover. Yeah. Just the things that we just forget about. Yeah, absolutely.

SPEAKER_01 28:10

And when you're hiring, we are going to go to two-on-one on employees. Um, so we'll go into more of the details there.

SPEAKER_02 28:15

But there are checklists out there though. Yeah, there are. You know, some of the small business websites have a lot of information. Um, and like I said, we've got stuff on our socials that we send um and on our website, and when people ask, we've got a little checklist. Yeah.

SPEAKER_01 28:30

So and look, we've gone through an enormous amount of technical jargon today. So this might be an episode that you actually need to re-listen to. Because for us it's second nature and we've gone through it really quickly, but it's super important that you get the structure right and you actually.

SPEAKER_02 28:46

I think it's really important. My advice is consult someone from the start. Because whilst you can change later down the track, admin headache, um, you won't enjoy it. It's easy for me. I'd be like, Yeah, I can change you. Yep, done.

SPEAKER_01 29:00

Yeah, but this is the thing, you have to get a new ABN, TFN, GST, zero like zero file bank account. You've got to change everything.

SPEAKER_02 29:08

If you're doing credit applications with businesses, you have to put all new credit applications through. It's a pain in the butt. So yeah, again, you start out how you mean to continue for the most part. And you know, life changes. So if your circumstances do change, it's fine. We can always help you fix it. But for the most yeah, for the most part, it's easier to do it right from the start. I completely and utterly agree with you.

SPEAKER_01 29:32

All in.

SPEAKER_02 29:33

Yeah, all in or all out. There's no halfway.

SPEAKER_01 29:36

All right, see you later, everyone. Bye. And that's a wrap on today's episode, everyone. Thanks for hanging out with us. We're very aware you could have been scrolling, snacking, or ignoring emails instead. So we appreciate you choosing us. If this episode gave you a light bulb moment, a laugh, or a quiet, oh wow, same, do us a favour and hit follow, leave a review and rate the podcast. It helps other brilliant people find us and makes the algorithm gods very happy. So share it with a mate, a biz besti, or that friend who's building something big and pretending they're not stressed. Until next time, use bold moves, chase the big winds and lead the way.