Money

Choosing the right tax structure for your Australian business

Exploring the best tax structures for businesses: Pty Ltd, sole traders, trusts, SMSFs, and joint ventures explained.

Published

6 months ago

March 11, 2025

Nathan Langridge

Pty Ltd, sole traders, trusts, SMSFs, and joint ventures explained.

In Short

Selecting the right tax structure is crucial for business success in Australia. Each structure has unique benefits and challenges, so understanding them helps ensure financial stability and compliance. Here’s a breakdown of the key options:

Sole Trader
Ideal for individuals starting a small business, a sole trader structure is the simplest and cheapest to set up. Business income is taxed at personal tax rates, but there is no separation between personal and business assets. While it offers simplicity, the downside is unlimited personal liability for debts.

Partnership
For two or more people in business together, a partnership allows for shared responsibilities. Profits are split between partners and taxed at individual rates. However, partners are personally liable for debts and potential disputes may arise, making clear agreements essential.

Company (Pty Ltd)
A proprietary limited company (Pty Ltd) suits businesses aiming for growth and liability protection. Companies pay a flat corporate tax rate (typically 25%-30%), offering tax advantages. Liability is limited to company assets, protecting personal wealth. However, companies face stricter regulations and higher administrative costs.

Trust
Common for asset protection and tax efficiency, trusts distribute profits to beneficiaries, who pay tax at their own rates. While they offer flexibility and legal protection, trusts are complex to establish and require ongoing management.

Self-Managed Super Fund (SMSF)
Used for managing retirement investments, an SMSF offers a concessional 15% tax rate on earnings. Trustees have full control but must comply with strict regulations and high compliance costs.

Joint Venture
Ideal for short-term projects between businesses, joint ventures allow entities to share profits and resources while maintaining separate tax obligations. They require well-structured agreements to avoid conflicts.

Choosing the right tax structure depends on your business goals, risk appetite, and financial strategy. Seeking professional advice ensures compliance and maximizes benefits.

Dr Steven Enticott is a finance professional, speaker, regular columnist, and author of The Man With A Plan.

For more information www.ciatax.com.au

Money

Fed cuts rates, signals more potentially ahead

Fed lowers rates amid job market concerns, signalling potential further cuts in upcoming meetings

Published

4 days ago

September 18, 2025

Ahron Young

Fed lowers rates amid job market concerns, signalling potential further cuts in upcoming meetings

In Short:
– The Federal Reserve cut interest rates by a quarter-point to address job market concerns.
– Officials expect at least two additional rate cuts by year-end amid ongoing economic uncertainties.

The Federal Reserve has reduced interest rates by a quarter-point, addressing concerns about a weakening job market overshadowing inflation worries.

A majority of officials anticipate at least two additional cuts by year-end during the remaining meetings in October and December.

Fed Chair Jerome Powell noted a significant shift in the labour market, highlighting “downside risk” in his statements.

The recent rate cut, supported by 11 of 12 Fed voters, aims to recalibrate an economy facing uncertainties from policy changes and market pressures.

Policy Dynamics

The decision comes amid intense political scrutiny, with President Trump openly criticising Powell’s reluctance to lower rates.

Despite the controversy, Powell asserts that political pressures do not influence Fed operations.

The current benchmark federal-funds rate now sits between 4% and 4.25%, the lowest since 2021, providing some reprieve to consumers and small businesses. Economic forecasts indicate ongoing complexities, including inflation trends and the impact of tariffs on labour dynamics, complicating future policy decisions.

Money

Fed faces unusual dissent amid leadership uncertainty

Fed’s Powell navigates contentious meeting amid Trump-appointed dissenters as rate cut looms and succession contest heats up

Published

5 days ago

September 17, 2025

Ahron Young

Fed’s Powell navigates contentious meeting amid Trump-appointed dissenters as rate cut looms and succession contest heats up

In Short:
– This week’s Federal Reserve meeting faces unusual dissent as Chair Powell approaches his term’s end.
– Analysts predict dissent over expected rate cuts due to political pressures from Trump-appointed officials.

This week’s Federal Reserve meeting is set to be particularly unusual, with Chair Jerome Powell facing significant disagreements over future policy as he approaches the end of his term in May.Tensions began before the meeting when Fed governor Lisa Cook won a court ruling allowing her to attend, despite opposition from President Trump, who is attempting to remove her.

The situation is further complicated by the recent swearing-in of Trump adviser Stephen Miran to the Fed’s board, following a Senate confirmation.

Analysts believe Powell may encounter dissent on an expected quarter-percentage-point rate cut from both Trump-appointed officials and regional Fed presidents concerned about inflation.

Potential Dissent

Trump has urged significant rate cuts and for the board to challenge Powell’s decisions.

Some analysts predict dissenting votes from Miran and other Trump appointees in favour of larger cuts. Federal Reserve veterans express concerns that political motivations may undermine the institution’s integrity, with indications that greater dissent could become commonplace.

Money

RBA plans to ban credit card surcharges in Australia

Reserve Bank of Australia plans to ban credit card surcharges despite banks warning of potential higher fees and weaker rewards

Published

6 days ago

September 16, 2025

ticker NEWS

Reserve Bank of Australia plans to ban credit card surcharges despite banks warning of potential higher fees and weaker rewards.

In Short:
– The RBA plans to ban surcharges on debit and credit card transactions, supported by consumer group Choice.
– Major banks oppose the ban, warning it could lead to higher card fees and reduced rewards for credit card users.

The Reserve Bank of Australia (RBA) intends to implement a ban on surcharges associated with debit and credit card transactions. Consumer advocacy group Choice endorses this initiative, arguing that it is unjust for users of low-cost debit cards to incur similar fees as credit card holders.

The major banks, however, are opposing this reform. They caution that the removal of surcharges could prompt customers to abandon credit cards due to diminished rewards.

A final decision by the RBA is anticipated by December 2025.