Embarking on starting or buying a business is a thrilling yet challenging endeavour. It demands research, risk-taking, passion, courage, and meticulous planning. At Owen & Peach, we don’t just understand the intricacies of entrepreneurship; we thrive on guiding our clients through the maze of business registrations, insurance, and structures. With years of experience, we have earned a reputation as business start-up specialists. We provide mentorship and a suite of practical tools, templates, and checklists designed to fast-track your business to success.
Starting or Buying a Business
Embarking on an Entrepreneurial Journey: Initiating a Business
The Foundations of a Successful Start-Up Business
Business Structure: The Blueprint of Success
Starting a business is like constructing a house; you need a solid foundation. At Owen & Peach, we emphasise the importance of establishing the proper business structure, akin to creating a blueprint for your success.
Our advisory services consider crucial factors such as income tax minimisation, asset protection, flexibility for new partners or investors, legal compliance, and future entitlements to discount Capital Gains Tax concessions.
Choosing the proper business structure is a pivotal decision. Options include sole trader, partnership, company, and trust. We assist you in evaluating your business’s likely profitability, stakeholders’ current tax position, and your industry’s risk profile. Our goal is to help you make an informed decision, recognising that the choice often involves a compromise based on the relative significance of these factors.
Accounting Software: Building Financial Stability
Accounting software is another foundational element for your business. The right choice can lead to massive headaches, and good records significantly cause business failure. Owen & Peach guides you in selecting accounting software that matches your essential needs with your level of accounting skill.
Up-to-date and accurate financial records empower you to make informed business decisions, aligning with our mission to help you reduce the cost of bookkeeping and tax compliance.
Tools for Success: Start-Up Expense Checklist
To build a successful business, you need the right tools. Our start-up expense checklist is a comprehensive tool identifying all potential establishment costs. This checklist includes tools, equipment, IT, marketing, leasehold costs, professional fees, and vehicles, ensuring you recognise all critical expenses in the start-up phase.
These figures seamlessly integrate into our cash flow budget template, allowing us to produce an expected profit and loss statement for your first year of business. Additionally, these reports can be incorporated into our business plan template, which is essential for securing external funding.
Business, Marketing, and Financial Plans
Owen & Peach offers in-house templates to help you put together your business, marketing, and financial plans. As accountants, we go beyond templates by providing financial modelling and preparing ‘what if’ scenarios to identify your best and worst-case profit scenarios. Our goal is to empower you with comprehensive plans that lay the groundwork for your business success.
Marketing Your Business: A Modern Approach
Marketing Strategy in the Digital Age
In today’s digital and social age, marketing can be the difference between boom and doom. While reputation and referrals remain valuable, online presence is increasingly critical. Owen & Peach stands out from other accounting firms with our expertise in marketing. We’ve assisted numerous clients with branding, and our online resources can help you build a modern brand that resonates with your target market.
Lead Generation and Website Development
We don’t just stop at branding; we can help you create an affordable, quality lead-generation website. Our guidance extends to website design, functionality, content, videos, calls to action, lead magnets, re-marketing strategies, and search engine optimisation. At Owen & Peach, we recognise the importance of a robust online presence as it often serves as the first touchpoint with potential customers.
Business Coaching: Your Path to Success
Our business coaching services at Owen & Peach are both broad and deep. Whether you need a business plan, succession plan, financial blueprint, or assistance with marketing, branding, website, and corporate brochure development, we have the knowledge, tools, resources, and experience to turn your ideas into profits. When you work with us, you have a genuine business advisor committed to your results.
Our Business Starter Kit: Your Comprehensive Guide
Many businesses need more proper professional advice. At Owen & Peach, we are passionate about your business success. To support our clients, we have published a comprehensive guide titled ‘The New Business Starter Kit.’ This valuable resource covers:
- Alternative business structures
- Essential tax and business registrations
- Employer obligations
- Record-keeping requirements
- Legal considerations
- Permits and registrations
- Buying a business or franchise
- Preparing a business plan
- Key business insurances
- Cash flow budget preparation
- Options for claiming motor vehicle expenses
Simplify Your Small Business Accounting with the Right Software
Streamline Tax Obligations and Save Time
Did you know the average business owner spends a staggering 109 hours yearly on tax-related tasks? That’s valuable time that could be better spent growing your business. Hence, the selection of appropriate accounting software holds the utmost importance.
Tailored Solutions for Your Business Needs
Avoid the frustration of purchasing accounting software that goes beyond your business requirements or accounting skills. Don’t settle for a ‘computerised shoebox’ that does little more than store your records. Optimise your record-keeping and reduce your accounting and bookkeeping costs with a software package that suits your needs.
Cloud-Based Solutions for Easy Management
With an array of accounting software programs available in the market, it’s easy to feel overwhelmed. From MYOB and Xero to QuickBooks and Cashflow Manager, our team strongly recommends cloud-based solutions. This not only ensures flexibility and accessibility but also simplifies collaboration and reduces the need for complicated software training.
Personalised Training and Ongoing Support
There is no need for lengthy and expensive software training courses. Our team can teach you the essentials of your chosen software package in just 1 to 2 hours. Plus, we provide ongoing support to assist you whenever you need it.
The Significance of Strategic Business Planning and Effective Cash Flow Management
Setting Your Business Up for Success
A business plan serves as more than just a means to secure financing. It is a crucial tool in proving the viability of your venture. Alongside your business plan, a cash flow budget takes centre stage.
Planning for Success: The 12-Month Cash Flow Budget
Creating a realistic cash flow budget is at the heart of effective business management. Before embarking on your entrepreneurial journey, we highly recommend meticulously preparing a 12-month cash flow budget. By proactively forecasting your cash flow, you can anticipate and navigate potential cash shortages that may hinder your progress.
Building on Solid Assumptions: The Key to a Reliable Cash Flow Budget
A well-crafted cash flow budget is built upon realistic assumptions. These assumptions form the foundation of your financial projections, supported by thorough research, available data, and known facts such as rentals or commodity contracts. Moreover, part of the invaluable insight your cash flow budget provides allows you to:
- Gain a clear understanding of your expected cash position each month
- Identify any fluctuations that may lead to prospective cash shortages
- Effectively plan for taxation payments
- Prepare for major capital expenditures
- Provide critical financial information to prospective lenders
Beyond Positive Cash Flow: Ensuring Long-Term Success
While positive cash flow is undeniably crucial, it alone is not enough. Equally significant is the ability of your business to generate profit. A positive trend in both cash flow and profitability serves as a solid indication of your long-term success.
Understanding Your Obligations when Employing Staff
Legal Responsibilities
Under common law principles, you and your employees have specific obligations to each other. Understanding your responsibilities by Federal and State Territory laws, industrial awards and agreements, tribunal decisions, and employment contracts is vital. Such awareness is paramount for ensuring compliance and upholding legal obligations.
PAYG Withholding and Income Tax
To ensure adherence to taxation regulations, it is imperative to register for PAYG Withholding if you employ individuals. Enhancing compliance, this step is crucial for maintaining legal requirements and fulfilling tax obligations. You can withhold the appropriate amounts, including income tax, from your employees’ wages. Additionally, if you pay suppliers who cannot provide an ABN, you must withhold 47% (starting from 1 Jul 2017).
PAYG Withholding Registration
Before commencing withholding payments, it is essential to register for PAYG Withholding. This registration process can be completed simultaneously with your GST registration, resulting in quarterly or monthly reporting requirements.
Please note that if you operate as a sole trader or partnership, you are not considered your employee, according to the Tax Office. Hence, there is no need to register for PAYG withholding or withholding amounts from your drawings unless the examples above apply to your situation.
Understanding Superannuation: Obligations for Employers
The Superannuation Guarantee Scheme
The Superannuation Guarantee Scheme, overseen by the Taxation Office, mandates that all employers must offer a minimum level of superannuation support to each employee (and certain contractors), with only a few specific exemptions. This ensures that individuals receive the necessary financial security for their retirement.
Exemptions and Payment Deadlines
Exemptions from the scheme include:
- Earnings of less than $450 per month
- Employees under 18 years of age working less than 30 hours a week
- Employees aged 70 years or over
Regular Contributions and Payment Dates
Employers must make superannuation contributions every quarter. Payment is required within 28 days following the conclusion of each quarter. Here are the payment dates for each quarter:
- 1 Jul – 30 Sep: Due by 28 Oct
- 1 Oct – 31 Dec: Due by 28 Jan
- 1 Jan – 31 Mar: Due by 28 Apr
- 1 Apr – 30 Jun: Due by 28 Jul
Consequences of Non-Compliance
Employers become liable for the Superannuation Guarantee Charge if the minimum level of support (9.5% for the year ended 30 Jun 2020) is not paid by the prescribed deadline. This charge is equivalent to the shortfall amount, an interest component, and an administrative charge.
The Importance of Business Insurance
As a business owner, insuring your premises and assets is not just a necessary step but a critical one. Despite the perception of insurance as an added expense, neglecting it can lead to irreversible financial loss in the face of natural disasters, theft, vandalism, fire, or any damage.
Understanding Your Business Insurance Needs
Addressing Your Specific Business Insurance Needs
To guarantee thorough protection, you must evaluate your insurance needs diligently. The size and nature of your business largely determine the type of coverage you need. Moreover, you must periodically review and update your insurance policies as your business grows or diversifies.
Essential Insurance Coverage for Businesses
Public Liability: Safeguarding Customers, Clients, and Visitors
Protecting yourself against liability from accidents or injuries on your premises is vital. Public liability insurance covers you in such situations.
Property Coverage: Shielding Your Assets
Coverage for contents, equipment, stock, furnishings, and fixtures shields your business against potential loss or damage.
Professional Indemnity Insurance: Perfect for Service Industries
Professional indemnity insurance safeguards service industry businesses against claims of professional negligence or errors. It provides essential protection and peace of mind, ensuring your business is covered in unforeseen circumstances.
Product Insurance: Essential for Manufacturing Industries
Manufacturers need product insurance to safeguard against liabilities associated with product defects or malfunctions.
Personal Injury and Income Protection: Ensuring Financial Security
While workers’ compensation covers work-related injuries to some extent, it only addresses a small percentage of the causes of disability. Personal injury and income protection insurance covers non-work-related injuries and can help you maintain your lifestyle and meet financial obligations.
Periodic Policy Review
It is crucial to review your assurance policies periodically to guarantee sufficient coverage. This practice ensures that you are adequately protected and prepared for unforeseen circumstances. As your business evolves, confirm your coverage keeps pace with any changes.
By taking the necessary steps to protect your business through comprehensive insurance coverage, you can secure its continuity and safeguard yourself against potential risks.
Critical Areas of Solicitor Assistance
Securing Your Business With Solicitor Assistance
A solicitor can play an essential role in your business, including contracts and agreements, lease negotiations, insurance claims, and resolving disputes with authorities or other companies.
Contracts and Their Importance
Understanding the significance of contracts is crucial for your business. A contract is a legally binding deal that consists of an offer, acceptance, consideration (typically the price of goods or services), and an intention to enter into a legal relationship.
Different Types of Contracts
Your business will encounter diverse types of contracts that impact its operations, involving:
- Purchasing another business
- Leasing business premises
- Obtaining financial services, such as an overdraft facility
- Conducting transactions with suppliers and customers, including terms of trade
- Managing employment agreements with employees
- Acquiring telephone, internet, and utility services
Establishing Clear Terms with Customers
Establishing an effective system to record your terms of trade is essential to prevent disputes and assist in debt recovery. Simple approaches like providing a customer-accepted quote can be helpful. Understanding that a signed contract is not the sole determinant of a legally binding agreement shapes this process.
Lease - An Essential Aspect For Businesses
Leases play a significant role in the world of contracts. They establish a special agreement between the property owner (the lessor) and the party granted its use (the lessee). Whether it involves land, buildings, or personal property like vehicles and office equipment, leases are crucial to various business arrangements. This guide will explore the essentials of leases, covering topics such as negotiation, lease terms, responsibilities, and legal considerations.
Negotiating the Lease Terms:
When entering into a lease, it is crucial to negotiate the terms that best suit your needs. The main aspects to address during negotiations include:
- The duration of the lease
- Rent amount and payment frequency
- Tenant’s responsibility for property outgoings
- Permitted uses of the property
- Options for renewal, if applicable
- Bonds or bank guarantees, if required
Seek Legal Assistance:
Navigating the complexities of charter agreements can be daunting. Consulting with a solicitor who specialises in leases is highly advisable. Their expertise can prove invaluable in ensuring that your interests are protected and that all necessary terms are correctly negotiated.
Maintenance Obligations:
In most leases, lessees are responsible for maintaining the premises, including fixtures and fittings. Additionally, some leases may require lessees to contribute to rates, insurance, and maintenance costs. Remember, these expenses are separate from the base rent and should be clearly stated in the lease agreement.
Early Termination and Costs:
If, for any reason, you need to vacate the premises before the lease’s expiration date, be aware that you may still be responsible for rent and ongoing expenses if a new tenant cannot be found promptly. Understanding the terms regarding early termination and costs is crucial before signing any lease agreement.
Legal Obligations and Disclosures:
To ensure transparency, lessors must provide lessees with a signed copy of the lease agreement before execution. Additionally, if the lease involves a retail shop, the lessor must provide a Disclosure Statement at least seven days before signing. Before finalising the lease, consult your solicitor and accountant while checking with the local council for necessary approvals.
Why Having a Will is Vital
Why Making a Will Should Be Your Priority
Creating a will is a core task that often gets postponed, like daily exercise and maintaining a balanced diet. However, it is one of the most significant documents you will ever sign, as it determines how your assets will be distributed. To ensure your wishes are appropriately reflected and your estate is distributed in the most advantageous and tax-effective way, it’s essential to take action.
The role of a well-crafted Will in Estate Planning
A well-crafted will forms the foundation of effective estate planning. Seeking competent legal guidance to draft your Will is vital, as a poorly constructed document can lead to countless problems for your surviving family members and beneficiaries.
By avoiding the potential pitfalls of dying without a will, you can spare your family from additional stress during an already challenging time. Furthermore, you retain control over who benefits from your estate rather than leaving it to strict government requirements.
The Consequences of Not Having a Will
Failing to have a will in place can result in costly repercussions and make the administration of your estate a cumbersome process. Without clear instructions, your estate may not be distributed according to your wishes, and you may not get the desired outcomes. By creating a will, you protect your legacy and bring yourself and your loved ones peace of mind.
Making a Will: Requirements and Benefits
To generate a valid will, you must meet the criteria, including 18 years of age and having a sound mind, memory, and understanding. Fulfilling these requirements ensures that your Will holds legal weight and is a testament to your wishes.
Estate Planning Considerations and New Business Starter Kit
Are you prepared for the future? Here are some important considerations:
Get Your Affairs in Order: An Effective Will
An up-to-date Will is crucial to protect your assets and fulfil your wishes.
Complex Trusts for Unique Needs
If you have beneficiaries with special needs, it might be necessary to establish more complex trusts within your Will.
Future Financial Security
Worried about providing for your family’s needs down the line? We can help you plan for a financially secure future.
Tax and Estate Planning Implications
Understanding the tax and other implications of your estate planning arrangements is essential. We can assist you in navigating this challenging scenario.
Maximising Life Insurance and Superannuation Benefits
Discover who will benefit from your life insurance and superannuation plans. We can guide you in making the most of these critical assets.
Property Ownership Matters
If you have property held as tenants in common, it’s essential to ensure appropriate legal and financial considerations are in place.
Organising Your Tax Records and Professional Contacts
Ensure your tax records and supporting documents are easily accessible, and keep your accountant, lawyer, and broker informed.
Remember, your Will should be reviewed regularly, particularly when your circumstances change, such as when starting a business. Feel free to contact our office for advice or a referral to a solicitor who can help draft or review your Will.
For more details, drop your query at admin@owenpeach.com.au or call us at (03) 9509 0188.