Starting and structuring a new business
If you’re thinking of starting a business, we can help you understand the rewards and drawbacks of different business structure types. We provide professional advice on the tax implications of each, and what structure will suit your needs now into the future. Choosing what structure to use as a new business looks very different to the company structures of already established businesses.
Business structure types in Australia
- Sole trader: an individual operating as the sole person who is legally responsible for all aspects of the business.
- Company: a legal entity that is separate from its shareholders.
- Partnership: an association of people or entities running a business together but not as a company.
- Trust: an entity that holds property or income for the benefit of others.
We can provide you with advice on the legal structure of a business. We draw on our extensive experience assisting our clients to set up various business structures over the years.
Changing your business structure
It is important as a new business to revise your business structure as your needs change and your business grows. Our team of experts can assist you with the transition and give you the information you need to fulfil your legal responsibilities.
As your business grows, you may decide to move to a different business structure. We can also assist with this transition and make you aware of any obligations for your new business structure.
Find out more information about choosing a business structure at business.gov.au.
To discuss starting a small business, or changing your business structure, please get in touch with our team of experts to make an appointment.
Buying an Existing Business
If you are considering buying an existing business, it’s important to do a comprehensive review of the business’s accounts, operations and systems, reputation, the industry and its competitors. This is commonly referred to as the ‘due diligence’ process. Doing your research to ensure you’re making the right decision is crucial. The Nexis Business Advisory team can assist you in interpreting the business’s records and evaluating its financial health and potential.
It’s important to gather as much information on the business you’re interested in before signing the contract to help identify and mitigate risks associated with the business.
Getting the business’s current value plays a large part in determining the current financial state and potential growth of a business.
Financial Due Diligence
It’s extremely important to collect and check the financial information of the business for the past three to five years, including:
- Tax returns
- Business activity statements (BAS)
- Records of accounts receivable and payable
- Balance sheets
- Profit and loss records
- Cash flow statements
- Sales records
Forecasting helps to identify sales and seasonal patterns, which can determine when the best time to buy is and provides insights into the cash flows that can be expected of the business, once acquired.
Understanding who your consumer base is and where your main revenue stream lie is important in minimising the risk associated with purchasing the business.
Find out if any prepayments have been made to the business that should be turned over so you aren’t forced to do work without compensation.
Nexis can assist you in collecting and interpreting this information to evaluate the business and make an informed decision.