atw: Re: Umbrella companies - long - maybe OT for you
- From: "Kevin Williamson" <kevin.williamson@xxxxxxxxxxxxxxx>
- To: <austechwriter@xxxxxxxxxxxxx>
- Date: Thu, 9 Jun 2005 15:12:05 +1000
Thanks for filling in some of the blanks that I forgot to Terry.
I had the same occurrence against my company recently. (Company - there
is only ME!).
My wife (bless her little cotton socks) does all my paperwork, but being
involved with doing the books for a couple of other businesses she
'thought' she had paid our PAYG and other 'dues'. Result - we are out
of pocket another $5000.00 above the 'dues' as a fine.
As a Sole Trader I didn't have half the paperwork and conformance
issues. But then again, I had none - she had it all!
Mind you, as was correctly stated in an earlier post, the ATO are a
little better to deal with than they once were. Except when it comes to
having to pay these damned fines!
Kev W
Kevin.williamson@xxxxxxxxxxxxxxx
-----Original Message-----
From: austechwriter-bounce@xxxxxxxxxxxxx
[mailto:austechwriter-bounce@xxxxxxxxxxxxx] On Behalf Of Terry D
Sent: Thursday, 9 June 2005 2:35 PM
To: austechwriter@xxxxxxxxxxxxx
Subject: atw: Re: Umbrella companies - long - maybe OT for you
I love to say "I hate to disagree", but I'd be lying.
The only reason you should consider setting up a
company is if it gives you advantages in obtaining
work. Like the financial advisers say of real estate investment, don't
do it just for the tax breaks.
I think there are very few tax advantages to having a
company these day--and if you think there are, I'd say
you should be nervous if you get audited.
I have been working through my own company for 15
years and the paperwork effort, when compared to being
an employee, is quite onerous.
It can be simple things like getting a warning from
the tax office regarding group certificates. Certain
that I'd done nothing wrong, I spent around two hours
on the phone (because the first two times I had to
hang up after about 30 minutes in the queue!) to find
out it was a 'computer error'.
If you time your holidays poorly and miss a due date
for super or BAS, it hits the fan again. I missed a
super payment by two days. For that I had to pay a
penalty of a fixed fee plus 10% of the super bill for
the whole year for all staff.
I know there are plenty of people out there who claim
their travel from home (office) to workplace as one of
the main benefits. I believe the ATO frowns on this
and I never have. Possibly my loss, but there again, I
want good policing, education, roads...
But, yes, I do think having to pay close to $40k per
year in tax through the company is also wrong--on what
I get as a personal income.
FBT has captured most of the other previously
available benefits.
Apart from all that, I think it's stupid to pay ASIC
and your accountant $1500 to save $1500 tax. I'm sure
the government would provide better community services
with the money than your accountant does.
My $40k's worth,
Terry
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