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Separating your personal assets from your business assets is a critical step when establishing your business. Often, this can be an overlooked aspect, with the belief that nothing adverse will happen. However, in the world of business, risk is always present and being prepared for whatever may come is one of the keys to success.
Protecting your personal assets from liabilities created through your business involves more than just insurance or securing your valuables. Here, we explore the best asset protection strategies that a small business accountant can help you implement.
Asset protection is not a one-time task but a long-term commitment. Understanding the necessity of these strategies and implementing them consistently is crucial for safeguarding your personal and business assets.
Running a business involves inherent risks. Even when business is booming, uncontrollable factors can impact your future. Market changes, economic downturns, or unforeseen global events can reduce revenue and lead to financial struggles. Additionally, accidents or legal issues can pose significant threats.
If personal assets are not separated from business assets, they may be used to cover business liabilities. This means personal financial trouble can follow business difficulties. Implementing asset protection strategies helps shield your personal assets from business risks, so let’s dive in to what they are …
1. Identify Your Assets Clearly
The first step in asset protection is knowing what assets you have. A small business accountant can help identify both business and personal assets, including property, investments, and even your business name.
2. Establish a Family Trust
Setting up a family trust is a common strategy for protecting personal assets. Assets in a trust are owned by the trustee, limiting liability. If your company is the trustee, business and personal assets are separated, protecting personal assets from business debts. However, it's important to note that this does not completely eliminate risk.
When looking at setting this kind of structure up, it’s important you chat to the Attune team – we’re experts in structuring your business to work for your specific situation.
3. Restructure Your Business
Many small businesses start as sole traders, where personal and business assets are intertwined. Transitioning to a company structure creates a separate legal entity for your business. This structure means that liability is borne by the company, not you personally. Directors and shareholders have different levels of liability, which helps protect personal assets.
Once again, for clarity on where liability lies for each party in this scenario, we’re here to help.
4. Ensure Adequate Insurance Coverage
Insurance is essential for protecting assets. Types of insurance to consider include income protection, life insurance, trauma insurance, and total and permanent disablement insurance. These policies can provide financial stability in case of personal or business setbacks. Regular reviews with your Attune Advisory team members can ensure your coverage remains appropriate and cost-effective.
5. Create a Legally-Binding Will
A will is a fundamental form of asset protection. It ensures that your assets are distributed according to your wishes. A testamentary trust within your will can protect assets from personal or business liabilities after your death. This also safeguards against family conflicts and financial mismanagement.
Although we can’t help directly with the set up of your Will, we can work directly with your lawyer or refer you to one of our partners, with whom we work often.
To conclude, implementing these strategies can provide robust protection for your personal assets. They are relatively straightforward and require the right expertise and understanding of your business needs to execute in the most appropriate way for you.
Your first stop should be a call to the Attune Advisory team for advice and help with your structure at each step. If you’d like to discuss the best strategy for you and your business, call Attune on 1300 866 113 or send us an email to start the conversation.
Are you a healthcare professional consistently thinking about your financial management and tax obligations? You're not alone. Balancing the numbers while delivering top-tier patient care can be daunting but, it doesn’t need to be that way – with our help, we can turn that anxiety into mastery, leaving your woes behind.
At Attune Advisory, we've had the privilege of guiding other healthcare practices through their finance and taxation obligations each year, ensuring they not only survive but thrive. As part of that, we thought we’d share some critical accounting issues that may be keeping you up at night – and how you can conquer them.
Running a successful healthcare practice goes beyond excellent patient care; it extends into the seamless integration of your practice management software (like Cliniko) with your accounting systems (like Xero). Why is this so crucial? Misaligned systems can cause financial discrepancies, administrative chaos, and, worst of all, business decisions based on inaccurate data.
At Attune Advisory, we can help assess whether integrating these systems is the right move for your practice. If it’s not a perfect fit, we can offer alternative solutions to keep your financials in check. Ensuring these systems communicate effectively can save time, reduce errors, and provide a clearer picture of your financial health, allowing you to make informed decisions.
The heartbeat of your practice is undeniably your team. However, they bring with them a complexity of financial and legal considerations. With a mix of employees, contractors, practitioners on service agreements, and locums, the payroll, taxes, superannuation, and insurance aspects, it can become a tangled web.
Misclassification of employment types can lead to severe legal and financial repercussions. We can help with structuring these arrangements to ensure compliance and prevent unnecessary headaches. By keeping the lifeblood of your business flowing smoothly, we help you avoid pitfalls that can disrupt your operations and financial stability.
With a blend of GST-free and GST-applicable transactions on both the income and expense sides, meticulous attention is required to your GST on a transaction-by-transaction basis. Errors here can invite the unwelcome attention of the ATO, including penalties and audits—costly in both time and money.
Our team specialises in managing these transactions with precision. We collaborate closely with your in-house or external bookkeepers to ensure your records are in the right shape, giving you the peace of mind you deserve. Correctly navigating GST complexities not only keeps you compliant but also optimises your financial operations and of course, relieves anxiety around what could be hiding beneath the surface.
Beyond these three issues, we offer an additional advantage to healthcare practices: proactive tax planning, structuring, and growth strategies tailored to the unique landscape of Australian healthcare. Our goal is to alleviate the pain of financial management and taxes, helping you to focus on your core mission of patient care.
Our strategic advice is tailored to you and your unique scenario – we take the approach that there is never a one-size-fits-all method to planning.
If you’re ready to transform your practice’s financial health, let’s start a conversation. Together, we can explore the issues highlighted here and develop a strategy to get your practice’s finances on the path to prosperity.
With the right guidance and expertise from Attune Advisory, you can focus on what you do best – caring for your patients – while we take care of the numbers (or at least support your team in doing so). Let’s make a plan to ensure your practice’s financial well-being today, give the Attune team a call on 1300 866 113 or email us here to start the conversation.
In an ever-evolving business landscape, staying ahead requires adaptability and proactive planning. Significant shifts, whether internal or external, necessitate a reassessment of your financial goals. Relying solely on annual reviews can leave you financially vulnerable. But, by regularly resetting your financial goals, you ensure they remain relevant to your current circumstances, enabling you to stay competitive and responsive to changes.
Checking in and updating goals helps us keep on top of our strategy and ultimately keeps you on the path to the kind of success you seek. With that in mind, we thought we’d share a step-by-step guide on how to effectively reset your financial goals.
The first step in resetting your financial goals is to assess your current financial situation. This involves a thorough examination of your Key Performance Indicators (KPIs) and the targets you've set for them. Ask yourself:
By scrutinising your KPIs, you gain a clear understanding of your current standing. This foundational step ensures that any adjustments you make are based on accurate, up-to-date information.
Once you have a clear picture of your current financial situation, the next step is to forecast how recent changes will impact your finances and indeed if you’ll need to adjust KPIs to suit. Consider how these changes might affect your cash flow, profit and loss statements, and balance sheet. This forecasting is critical as it forms the basis for your revised goals. When making these forecasts:
Accurate forecasting helps in setting achievable and relevant financial targets, providing a roadmap for navigating future challenges and opportunities. It allows you to approach the future with a strategy that’ll give you the best chance of success.
Collaboration is a crucial element in refining your financial goals. Engage your team members and advisors in the goal-setting process. Depending on your goals, the Attune Advisory team can be part of your collaborative team, offering tailored advice that can drive you forward. A collaborative approach like this has several benefits:
Regularly resetting your financial goals is not just a recommended practice but a necessary one in today’s dynamic business environment. By being proactive, agile, and responsive, you can ensure your financial goals remain aligned with your current circumstances.
At Attune Advisory, we understand the challenges businesses can face as the landscape moves around us and are here to help you assess your financial situation and set achievable goals. Whether you are new to goal setting or facing significant changes in your business, we offer the guidance and support you need to stay on track.
For more information and tailored, professional advice, call the team on 1300 866 113 or contact us via email to start the conversation – you’ll be glad you did.
As part of your job or the running of your business, you may be eligible to claim deductions for travel expenses incurred when travelling and staying away from home overnight for work purposes. Understanding the eligibility criteria and knowing which expenses you can claim can help you maximise your tax return.
At Attune Advisory, we specialise in tax – both personal and business – and can guide you on how to ensure you’re doing everything you can to improve your tax position.
With that in mind, we thought we’d cover what you need to know about claiming travel expenses as part of your tax lodgements.
To claim travel expenses, you must meet specific conditions. You can claim a deduction for travel expenses—accommodation, meals, and incidental costs—if you travel and stay away from your home overnight in the course of performing your employment duties. Here are the key criteria:
For instance, if you need to travel interstate for several days to meet clients, you qualify for these deductions. However, if your travel is due to personal circumstances, such as living far from work or choosing to stay near your workplace rather than commuting home, these expenses are considered private and are not deductible.
You can claim a variety of travel-related expenses:
It’s important to note that if your travel includes both work and private purposes, you can only claim the portion related to work. For instance, if you extend a business trip to include a holiday, you must apportion the expenses accordingly.
To claim these deductions, maintaining accurate records is crucial. Keep all receipts or other written evidence of your travel expenses. You will need to submit these when claiming your deduction under “Work-related travel expenses” in your tax return.
In rare cases, you might be able to claim expenses for accommodation you rent or buy for temporary work-related travel. These expenses must be proportionate to the cost of suitable commercial accommodation for the period and must not arise from personal choices, such as maintaining a separate residence. We can guide you through the specific rules to ensure compliance when we speak.
Certain travel expenses are not deductible:
If you are living at a location where you work, such as in a unit or house, and your regular place of work changes, these expenses are not deductible as they are considered private.
When travel is for both work and personal purposes, you must apportion the expenses. For example:
If the personal part of your travel is incidental, such as a brief holiday after a work trip, you may not need to apportion your costs. However, clear documentation and careful record-keeping are essential to substantiate your claims.
Navigating travel expense claims need not be confusing but it’s important it’s done right. And, doing it correctly can allow you to maximise your deductions and ensure compliance. For personalised advice and expertise, contact us the Attune team on 1300 866 113 – we are here to help you make the most of your tax position while ensuring you’re adhering to all necessary regulations.
