The structure decides the tax, the risk and what you can do next
Most structure problems trace back to a decision made in a hurry on day one: a sole trader ABN because it was quick, a single company holding the trading business, the property and the brand, a trust set up because a friend had one. The business grows, the structure does not, and the cost shows up as tax that did not need to be paid, a family home exposed to a business claim, or a partner or buyer who cannot be brought in cleanly.
Business structuring at New Wave is the review and the fix: what you have, what it is costing you, what the business will need in three years, and the structure that gets you there with the tax consequences of the change modelled before anything moves.
The four building blocks
| Structure | Where it fits | Watch for |
|---|---|---|
| Sole trader | Testing an idea, very low risk, no staff | Unlimited personal liability, income taxed at your marginal rate, hard to bring in a partner |
| Partnership | Two or more owners in a low-risk service business | Joint and several liability, no retained earnings at a lower rate |
| Company | Trading businesses with staff, risk or retained profits | Director duties, Division 7A loans, franking when profits come out |
| Trust | Family groups, asset holding, flexible distribution | Deed terms, trustee company, distribution resolutions by 30 June |
Beyond about $1M of revenue the answer is rarely one of these on its own. It is usually a group: a trading company that carries the risk and owns as little as possible, a separate entity holding the property, equipment and intellectual property and leasing them to the trading company, and a holding company or family trust above both.
Asset protection
Structure is also how a business protects what it has built. If the trading entity is sued or fails, the valuable assets should not be inside it, and the family home should not be reachable through it. Done early this costs little. Done after a claim exists it does not work and can be unwound. We review asset protection in every structuring engagement and work with New Wave Law on the deeds, agreements and leases, so the accounting advice and the legal documents say the same thing. Our guide to business structures in Australia covers the mechanics in more depth.
Restructuring an existing business
Moving a business from one structure to another has tax consequences of its own: capital gains, stamp duty in some states, GST and the small business restructure rollover rules that can defer or remove some of them. We model the options, tell you what the change will cost and what it will save, and quote the work before it starts. Restructures are planned as a project, often timed to a financial year end, not done piecemeal.
Structuring for the next event
- Bringing in a partner or investor. Share classes, shareholder agreements and a structure that lets someone buy in without triggering a tax bill for the existing owner.
- Buying a business. Which entity should buy, and what that does to tax and risk. See due diligence.
- Selling in two to three years. Getting the structure into a position to access the small business capital gains tax concessions well before a buyer appears. See business valuations.
- Succession. Handing a business or a property portfolio to the next generation without dismantling it.
How it runs
- A free 30-minute discovery call with a New Wave team member to understand the business, the family group and what is coming.
- A structure review quoted up front: current entities mapped, risk and tax identified, options modelled, a written recommendation.
- Implementation quoted separately: new entities, registrations, bank accounts and the legal documents through New Wave Law.
- Reviewed every year as part of tax planning, because the business will keep changing.