Accounting News & Blog

We're in for a bumpy ride but it's important we don't allow ourselves to get too caught up. Cool heads, good risk management practices and good health hygiene prevail.


As has been widely stated, for most people, Covid-19 will seem no worse than a bad cold but there are elderly and other people in our community who will be more vulnerable. None of us will know exactly the personal or health circumstances of people we come in contact with every day be they staff, co-workers, customers or suppliers...


BUT it is important we all assess and mitigate risk. It's important that we're all considerate of others. What if we see the Australian Government banning the activities or events you're planning? What if you can't fill orders from suppliers? How will you deal with it?


Every business should be thinking about the potential impact Covid-19, including any economic flow-on effects. Develop and/or implement WHS policies such as self-isolation, sick leave, transferring services or meetings online, introducing work from home policies, reconsider the need to gather in groups etc. and do your bit at the local level. Check out your insurance policies too. You might be covered for losses. Every policy and business will be different.


It's an ever-changing situation. Again, each business will be different, the impacts will vary as will the circumstances of each individual so it's up to you as business owners or managers to take appropriate action.


We will happily pass on any relevant information through our channels but please identify and make note of reliable sources of information for your own purposes.


Resources and Information


We've created a Covid-19 poster for Rowe Partners clients based on current WHO recommendations. You can print it out and display them in your workplace. No pressure, just trying to be helpful. Message us below and we'll send you the file.


As is often the case, we're finding that the ABC is providing the most reliable and up to date information on Corona Virus but you should also check out this information from Safe Work Australia and your relevant industry association websites.


https://www.safeworkaustralia.gov.au/…/coronavirus-covid-19…


For more information Contact one of the following 24/7 information lines:


  • Coronavirus Health Information Line on 1800 020 080

  • Healthdirect Hotline 1800 022 222


Anyone who knows Chad McKnight, knows that he absolutely loves riding and the Tour Down Under. He counts the days until it comes around. Take a read of his most recent TDU trip to Adelaide riding from Norwood to Murray Bridge...and back!


I love the Tour Down Under! I can't wait to take the week off of work to be totally immersed in a different world and indulge one of my passions. I head to Adelaide, wear lycra all week long, enjoy fantastic coffee, delicious pastries and of course some great South Aussie beer. I ride around with my mates and 1000's of other like-mind individuals. We get to see some of the best cyclists in the world, on the best bikes, in our city of Adelaide (one of the best cities in the world for bike riding), compete to take out the first leg of the world tour.


I compete in the Community Challenge Ride and have done for the past 7 years. It's a fully supported ride with closed roads, drink and food stops along the way. It maps the exact same TDU course as the pros use for the Stage 4 Route but we ride it before the pro riders. The race has start locations at Norwood (163.3km), Williamstown (110km), Mt Torrens (78.5km) and Mannum (33km) to accommodate different skill levels. We started off from Norwood and rode to Murray Bridge through some spectacular country and towns. Many of these communities had recently been affected by bushfire too so the influx of riders and spectators for the TDU and Community Challenge provided them with a very welcome financial boost. This year we decided to add an extra challenge. Instead of getting a lift home as we've done in previous years, we decided to ride back to the city. So after conquering many hills, battling headwinds and 9hrs 30mins on the road, we ended up riding a total of 265kms for the day. The beers at the end were well deserved and appreciated!


The highlight and a must-do for us every year is to tackle Willunga Hill, the last stage. It's definitely not for the faint-hearted or the inexperienced rider. It's a gruelling 3kms. Getting to the top and the finish line for that day's race is always a great experience. There are thousands of people lining the road up and the end to wait for the pros to finish. Awesome atmosphere! This year I set a new PB of 11:35 but Richie Porte, the King of Willunga Hill and this year’s winner of the TDU did it in 6:35. WOW! Very impressive. All up for the week I rode 575kms and loved it!


Photos attached

  • My new bike ready for the big 265km day

  • Map of the course

  • A photo with some of the crew I spent the week with at the top of Willunga Hill

  • A photo of the Garmin showing our total distance and time for the day

  • The Pro's spare bikes on the roof of the support car

  • The finish line at Paracombe where Ritchie Porte took the leaders Ocre Jersey.

  • 4 of the 7 of us who rode home enjoying a well-deserved beer

  • Pie (I love a good pastry)

If you're a sole trader or are thinking of starting a business & applying for an ABN, then this piece by Michael Nutt, one of our partners, is a must read.

If I had a dollar for every time, I have heard a new client say ‘oh I just went online & applied for my ABN & started… it was so easy’ I would have a nice crisp pineapple sitting in my wallet today.


On occasion a new client will come to us to prepare their tax & unbeknownst to them they have been trading in a completely inappropriate structure to their needs & requirements, putting themselves (& their assets) at risk & paying unnecessary, potentially avoidable amounts of tax.


At Rowe Partners we enjoy nothing more than helping clients to re-structure their businesses to a more advantageous entity such as a Trust or a Company or even a combination of both.


So, what is a Trust? What is a Company? And why should you consider structuring your upcoming business venture and or re-structuring your current arrangement? Because you’re really looking for a best fit solution for your business, rather than an off the shelf, one size fits all structure.


Trusts


Trusts are widely used for investment & business purposes. The Australian Tax Office tells us that:


“A Trust is an obligation imposed on a person or other entity to hold assets for the benefit of beneficiaries. While in legal terms a Trust is a relationship not a legal entity, Trusts are treated as taxpayer entities for the purposes of tax administration.


The Trustee is responsible for managing the Trust's tax affairs, including registering the Trust in the tax system, lodging Trust tax returns and paying some tax liabilities.


Beneficiaries (except some minors and non-residents) include their share of the Trust's net income as income in their own tax returns. There are special rules for some types of Trust including family trusts, deceased estates and super funds.”


Trusts are commonly used by small to medium business owners & allow profits to be distributed to beneficiaries as determined by the Trustees in which could greatly minimise annual tax liabilities.


To put this in dollar terms if a sole trader amassed a $100,000 net profit for the year then this $100,000 would all be taxable wholly & solely in the sole trader’s name at tax time amounting to $25,717 in tax payable in the 18/19 financial year.


If instead the individual was operating through a Trust structure & all conditions were satisfied & the individual had a wife who was not employed & home with 2 kids & the trust was able to distribute profits by the way of $50,000 to Dad, $49,200 to Mum & $400 to each child, the total tax liability would then be $14,934 for the year. A massive tax saving of $10,783 in just one financial year. Yes! A saving of $10,783 in tax in one year alone!


What is a Company?


Rather than risk confusion & attempt to write a definition of a Company, it’s best to refer you to the official definition according to the Australian Securities and Investment Commission (ASIC).


According to ASIC, “a Company is an entity that has a separate legal existence from its owners. The owners of the company are known as members or shareholders. Its legal status gives a company the same rights as a natural person which means that a company can incur debt, sue & be sued. Companies are managed by Company officers who are called Directors & Company secretaries.


Small business owners often use a type of company structure called a proprietary limited company (which has the words 'Pty Ltd' after the name). This type of company does not sell its shares to the public and has limited liability. Larger companies that do sell shares to the public can still limit their liability and will often have the abbreviation 'Ltd' after their name.”


The Benefits of a Company Structure


Limited liability - The Company has its own legal entity so the liability of members or shareholders is limited and generally they will not be personally liable for the debts of the company. (However, the owners (shareholders) may still be liable for a Company's debts, such as when they have provided personal guarantees to borrow money.) Lower tax rate - Income generated by a Company attracts a Company Tax Rate. This may also be a disadvantage because the Company Tax Rate applies from the first dollar of income generated.”


Rowe Partners specialise in assisting our clients choose the best possible structure for their business & investment needs. We invest in this area heavily & often, to ensure we have the most advanced tools & expertise at our fingertips to help. We understand the ins & outs, the pros & the cons of the range of available options.


Ask us about our complete set up solution which includes set up of:

  1. structures such as trusts & companies

  2. associated registrations such as:

  • tax file numbers (TFN)

  • Australian Business Numbers (ABN)

  • Goods & Services Tax (GST)

  • Pay as you go withholding tax (PAYGW)

  • Workcover & registered business names

  • Cloud accounting software

Selecting the right business structure for your business requires very careful consideration & advice from someone with detailed knowledge of the options. It's important that you seek such advice before making any changes or decisions. Call 1800 04 7693 today for an appointment to discuss your needs.


With Rowe Partners services in business structure support & setup, you’ll save time & money by starting off on the right foot.


Rowe Partners Wealth Advisors Pty Ltd trading as Rowe Partners Financial Planning, Corporate Authorised Representative 1262602 | GPS Wealth Ltd | AFSL 254544 | Australian Credit Licence 254544 | 1700 548 2726 | www.gpswealth.com.au

Level 1, 4 Smart Rd

PO Box 570

Modbury SA 5092

33 Florence St

PO Box 639
Port Pirie SA 5540

8 Church St

PO Box 2247
Port Augusta SA 5700

Murray Bridge

Ground floor, 30 Seventh St

C/- PO Box 570
Modbury SA 5092

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Rowe Partners Pty Ltd (ACN 105 365 688) as an agent for Rowe Partners Partnership (ABN 65 250 711 759). Directors: R P McDonald FCPA, C R McKnight FCPA, P J Connolly MIPA, F B Cammarano AIPA, M R Nutt CPA. Liability limited by a scheme approved under Professional Standards Legislation other than for the acts or omissions of financial services licensees.

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