Scolari Comerford Blog

How To Keep Company Carry Forward Tax Losses Intact - New Rules In.

Posted by Peter Scolari on Aug 29, 2017 2:24:00 PM

INTRODUCTION:

Your small business accountant set you up in a company and in recent years things have been pretty tough business wise so much so that the company has incurred significant losses. Your business partner who feels the business cannot afford 2 owners and who owns the other 50%, has asked you to buy them out. Details are worked out and you figure that by making a new start, this will be a wonderful catalyst for change where the business revisits how it can become profitable and recoup the $500,000 in losses.

Figure 1: "I'm not cranky I can't carry forward those losses. I'm catatonic!" Scolari Comerford Chartered Accountants Sydney Dubbo.

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Topics: Buying A Business

Selling Memorandums That Get Much Higher Business Valuations

Posted by Peter Scolari on Jul 25, 2017 9:53:59 AM

INTRODUCTION:

As a business valuer I often come across enterprises for sale and when I do it is always interesting to go through the Selling Memorandum. This document contains crucial business information and is provided to potential buyers whether they be sourced through succession planning or someone from outside the organisation.

Such information will assist these groups to make an informed decision about the purchase and the price. It should therefore ensure that it is both up to date and accurate.

A Confidentiality Agreement should also be prepared and signed by the potential successors and buyers before giving the Selling Memorandum to them.

Figure 1: With a Selling  Memorandum, you need it to contain information that will have  potential buyers asking for more. Scolari Comerford Business Valuers Sydney & Dubbo

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Topics: Business Valuation, Selling Your Business, Buying A Business

Overnight Success(ion) Planning & Business Valuations - Act Now!

Posted by Peter Scolari on Jul 6, 2017 4:01:19 PM

INTRODUCTION:

If you are a business owner who is thinking of selling down the track, succession planning will require matters that affect now and the future. Most importantly this will include the business valuation side of things. Based on various media sources up to 70% of business owners will be looking to sell in the next 5 years.

How then do you best prepare to get the maximum possible sale price?

Here are 10 considerations that will affect your future.

Figure 1: Will you be making a sale from without or will you be nurturing the younger team players from within? Photo courtesy Balmain Baz Lara Scolari Gallery Balmain

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Topics: Business Valuation, Succession Planning

Taking Care Of (&) Doing Business In Australia - Branch Or Subsidiary?

Posted by Peter Scolari on Jul 4, 2017 11:02:08 AM

INTRODUCTION:

If you're a foreign company thinking of doing business in Australia, you will need to establish what type of operating vehicle you will use. Generally, you will have a choice between:

  • branch office; or an
  • Australian incorporated subsidiary.

Before deciding which way to go a number of considerations should be taken into account. These will include (but not limited to):

  • taxation;
  • risk;
  • third party requirements;
  • running costs;
  • funding requirements at the local level.

Here are some discussion points around these key issues. 

Figure 1: Taking care of business in Australia will involve considering a number of legal & taxation aspects. Bachman Turner Overdrive "Taking Care Of Business".

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Topics: best accountant sydney, Doing Business In Australia

5 Ways A Debtor Days KPI Can Give Business Completely Wrong Insights!

Posted by Peter Scolari on Jun 26, 2017 12:48:12 PM

INTRODUCTION:

As both small business advisors and small business accountants, our team is constantly reviewing our clients' numbers on a monthly, quarterly and annual basis looking for ways to provide valued advice particularly with respect to cash flow. Why? Well this is one of an SME's biggest concerns.

Whilst the accounting profession is starting to realise this need, it's one thing to spit out KPIs (Key Performance Indicators) but it's another to delve deeper and provide insightful analyses as sometimes the numbers don't tell the full story.

Let's look at one of the most crucial cash flow KPIs Debtor Days for example. This KPI tells you approximately how long on average your customers are taking to pay you once the invoice has been raised. In its most simple sense, the debtor days KPI is calculated as follows:

Amount of Debtors Owing At the End Of The Period Divided By Total Sales For The Period Multiplied by Number Of Days In The Period

 

Figure 1: When setting and analysing KPI goals, it's important to look deeper once the initial assessment has been made.

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Topics: Cash Flow Forecasts, cash flow, business advisors, business planning

Business Valuations 101 - Crucial Info Business Valuers Request & Why

Posted by Peter Scolari on Jun 21, 2017 3:01:44 PM

INTRODUCTION:

There will usually be a number of reasons you are considering getting a business valuer to perform a business valuation. These include:

  • potential purchase or sale of a business/share;
  • partner/shareholder dispute;
  • taxation (capital gains for non-arms-length transactions);
  • compulsory acquisitions by governments (extinguishment or loss of profits & relocation);
  • family law business valuations.

If you require such an analysis, business valuers will usually ask for the following so you should have these on hand wherever possible.

Figure 1: Giving a business valuer the right information will increase your chances of a higher sale.

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Topics: Business Valuation

How To Get The Gov't To Put In 50% Of An Artwork's Value Via Tax!

Posted by Peter Scolari on Jun 13, 2017 4:38:56 PM

INTRODUCTION:

If you buy an asset by 30 June 2017 and it costs less than $20,000 (GST Exclusive), if you qualify as a small business and use the asset for your business (or part thereof), you can claim a deduction for the business portion of each asset you buy without having to write them off over several years. Now if you have an office for work and adorn it with art, be aware of the immediate tax deduction you should be getting. The 2017 Budget has extended this concession to 30 June 2018 but this has not yet been passed in Parliament. If you are thinking of buying an asset (including art) less than $20,000 and you satisfy the criteria, you might be best to do it before 30 June 2017 to make sure you get the deduction now while you can.

Does this mean you can buy art then effectively at 51% of its price after tax (if you are paying tax at 49%)? Well, technically yes.

What then are some of the key points & eligibility criteria?

Figure 1: Even the Beatles invested in art even though they might just have failed the turnover test! Photo courtesy of Lara Scolari Gallery Balmain

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Topics: Small Business, best accountant sydney

Fill A Bucket Company & Get The 50% CGT Discount? = Major Tax $aving$!

Posted by Peter Scolari on Jun 7, 2017 5:07:22 PM

INTRODUCTION:

It's tax planning time so small business accountants everywhere should be drafting trustee distribution resolutions ensuring the minimum amount of tax is being paid.

Figure 1: Is this your current scenario?

One such strategy is to distribute monies to a corporate beneficiary or a 'bucket company' as it is sometimes known to limit tax to 30% instead of to an individual beneficiary whereas as much 49% can be paid. There are however, a few 'hurdles' with this strategy namely:

  • The trust eventually needs to put the monies physically into the company (cash flow can be an issue - you should consult your small business accountant and work through it via a three way budget/cash flow forecast);
  • Whilst the tax is limited to 30% in the company, when an individual wants to get their hands on the money in the company, depending on their taxable income prior to the dividend, they may end up paying 45% plus Medicare and Budget Repair Levy so even after franking credits how much have they really saved anyway in tax in the long run?;and
  • If the monies invested in the company make a capital gain, if the assets have been held for at least 12 months, the company does not get the 50% discount as an individual generally does so again when the net gain is accessed out of the company, more tax is payable than if the asset had been held by the individual.

What to do then? Is it possible to have your cake and eat it too?

Figure 1: Capture more tax savings in that bucket when using a corporate beneficiary with your discretionary family trust! Scolari Comerford Chartered Accountants Sydney & Dubbo

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Topics: business advisors, tax, capital gains tax

This Old House - Tax Changes That Will Cause Shakin Stevens To Shudder

Posted by Peter Scolari on Jun 2, 2017 12:37:28 PM

INTRODUCTION:

If you are a property investor, no doubt you will be nervous about some of the Government's proposed changes limiting tax deductions for rental properties.

What are some of these changes and what do they mean when it comes to saving or paying more tax?

Figure 1: Some of these tax changes for property investors will have even Shakin' Stevens up in arms.

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Topics: best accountant sydney, tax

Xenophon Or Zorro? Tax Planning To Slash Taxes For Small Business

Posted by Peter Scolari on May 31, 2017 12:03:43 PM

INTRODUCTION:

The 2016/17 Federal Budget announced plans to increase the turnover threshold for small business entities (SBE's) from $2,000,000 to $10,000,000. Whilst the Bill has not yet passed through Parliament (mainly the proposed corporate tax reductions being a sticking point), we understand a deal has been done with Senator Nick Xenophon. Business owners and their small business accountants should check that the following changes do in fact take place and then apply them where appropriate.

Many of the proposed changes will see SBE's pay less tax.

So what are the main changes? 

Figure 1: Many of the proposed changes will see SBE's pay less tax. Scolari Comerford Small Business Accountants Sydney & Dubbo

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Topics: Small Business, business advisors, tax, small business accountant dubbo, small business accountant sydney

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