Guide for the new business set up

I want to start my own business? Can you help me?

Starting your own business is such an exciting time. You have a lot to do and think about and might not know where to start when it comes to your accounting requirements.

Whether you have just registered an ABN and need advice on becoming a Sole Trader or work as a contractor on your personal ABN or need to set up a company or trust structure from which to run your business we can help.

We can offer start-up advice, registrations, accounting software set up, advice on the best structure for the business, bookkeeping support, ongoing taxation compliance and more. We also offer fixed price accounting, bookkeeping and tax packages. Our packages include GST returns, financial accounts, tax returns, advice and support for a fixed monthly fee. Reach out to us & we can customise a package tailored for your business.

Check out our business packages 

Do I have to register for GST?

If you expect your turnover to be over $75,000 a year you will need to register for GST. If you are not sure you can wait a quarter or two to see if you will achieve $75,000+ in sales and then register for GST at the start of a quarter. A quarter starts on the 1st July, 1st October, 1st January and the 1st March.

Once you register for GST you are required to add 10% GST to your invoices to your customers. In other words you start to collect GST from your customers (called GST collected). However, you can claim back GST paid on business expenses. Normally, your GST collected will be greater than your GST paid which means you will have a GST liability to pay each quarter.

Can North Coast Accounting register my Pty Ltd Company or Discretionary Trust for me?

Yes—North Coast Accounting can assist you with setting up both a Pty Ltd company and a discretionary (family) trust.

We can help with the full setup process, including:

• Registering your ABN and TFN
• Setting up your Pty Ltd company with ASIC
• Preparing and establishing a discretionary trust deed
• Assisting with business name registration
• Setting up GST registration (if required)
• Structuring advice to suit your tax and business goals

Included in our structure establishment services is an initial meeting with the one of our accountants who will discuss your business requirements to ensure that you are structuring your business tax effectively, and with the relevant asset protection.

We will also meet with you upon completing the documents required to discuss your taxation obligations going forward

If you’re unsure which structure is best (company vs trust vs sole trader), we can guide you based on your income expectations, risk level, and long-term plans.

What tax record/bookkeeping software do I need to keep for my business?

 The Australian Taxation Office (ATO) requires businesses to keep accurate records of their income, expenses, assets, payroll, and GST transactions. Using bookkeeping software can help you stay compliant and save time at tax time. To start with open a separate business bank account, so all the records of income and expenses are maintained properly.

If you are a small sole trader or one-person business with relatively simple transactions, an Excel spreadsheet may be sufficient to keep track of your income and expenses.

However, as your business grows, employs staff, becomes GST registered, or involves more complex transactions, using dedicated bookkeeping software is highly recommended.

Popular accounting software options include:

• Xero
• MYOB
• QuickBooks Online

Our preferred bookkeeping software is Xero. Xero plans start from approximately $50 per month, and promotional discounts are often available for new subscribers.

One of the major benefits of Xero is that it can connect directly to your bank account through bank feeds. This means you do not need to manually enter every transaction. Instead, transactions are automatically imported, and you simply allocate them to the appropriate income or expense category.

Xero can help you:

• Track income and expenses
• Manage GST and BAS reporting
• Process payroll and superannuation
• Reconcile bank accounts
• Generate financial reports
• Access your records anywhere online

If you prefer to use MYOB, QuickBooks, or Reckon, that is perfectly fine. We work with all major accounting software platforms. However, Xero remains our recommended solution due to its ease of use and cloud-based functionality.

North Coast Accounting can manage your Xero bookkeeping for you, with fees starting from $200 per month and increasing depending on your turnover, payroll requirements, and number of employees. Check out our business packages:

https://www.ncaaccountants.com.au/business-packages/

Regardless of the software you use, you must keep records and tax invoices relating to your business purchases for at least 5 years. We recommend maintaining a dedicated folder and filing your purchase invoices in date order for easy reference and ATO compliance.

What is the best business structure for my business?

The best business structure depends on your income, business activities, growth plans, asset protection requirements, and tax considerations. There is no single structure that is right for every business.

The most common business structures are:

Sole Trader

• Simple and inexpensive to set up
• Lower administration costs
• Business income is taxed at your personal tax rates
• Limited asset protection

Company

• Separate legal entity
• Provides greater asset protection
• Profits are generally taxed at the company tax rate
• More administration and compliance requirements
• Can provide tax planning opportunities as the business grows

Trust

• Can offer flexibility in distributing income to beneficiaries
• May provide asset protection benefits
• Suitable for family businesses and investment activities
• More administration and compliance requirements

Partnership

• Suitable where two or more people operate a business together
• Profits are shared between partners
• Relatively simple structure
• Partners may be personally liable for business debts

The right structure can have a significant impact on your tax outcomes, asset protection, succession planning, and future business growth. A structure that works well when starting a business may not be the most effective as your business becomes more profitable.

We can review your specific circumstances and recommend the most appropriate structure to help minimise tax, protect assets, and support your long-term business goals.

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What is the Purpose of a Business Activity Statement (BAS)?

The purpose of a BAS is for you to pay your:

• GST
• PAYG withholding from your employee’s wages and
• Your PAYG Instalments on your business profit
• When Do You Lodge a BAS?
• You are required to lodge and pay BAS for the following quarters;

Jul-Sept – Due 28th October
Oct-Dec – Due 28th February
Jan-Mar – Due 28th April
Apr-June – Due 28th July

GST Payable

Once you register for GST you are required to add 10% GST to your invoices to your customers. In other words you start to collect GST from your customers (called GST collected). However, you can claim back GST paid on business expenses. Normally, your GST collected will be greater than your GST paid which means you will have a GST liability to pay each quarter.

So let’s say for example to for the quarter July-Sep you invoiced to customers $20,000 plus GST and paid $7,000 in expenses then your GST payable for the quarter is:

$2,000 minus $700 = $1,300

PAYG Withholding Payable

Also, in the BAS you need to pay your PAYG withholding for your employees. So, for example you had one staff member and his wages were $1,153 gross per week then the tax per week would be around $229. This means you pay him $924 per week after tax. However, in a quarter if you paid him 13 times (or 13 weeks) then the PAYG withholding will be $229 x 13 weeks = $2,977.

PAYG instalments Payable

Also, on your BAS you will need to pay a PAYG instalment on the profit of your business. For example, let’s say you are a sole proprietor and last year you made a profit (income less expenses) of $50,000 then your annual tax liability on this income is $8,547. So if we divide into four quarters that is $2,136 per quarter.

If you make these instalments on your BAS each quarter and your profit for the current year is the same then you won’t owe any tax at the end of the year.

If your profit is more, you will need to pay the difference.

If your profit is less, you will end up with a tax refund.

Talk to the team at North Coast Accounting today and get the expert advice you need to start your business with confidence. Whether you need help choosing the right business structure, registering for GST, setting up bookkeeping systems, or understanding your tax obligations, our experienced accountants are here to support you every step of the way. Let us help you build a strong financial foundation for your new business journey.