Blog & Resources

Taxation Planning - Selecting an appropriate tax vehicle

Using the right accounting / taxation structure can have a dramatic effect of the amount of tax you will pay and how protected your assets are.

When it comes to making and investment of starting a business, typically the following structure are available:

1.    Sole Trader


2.    Partnership


3.    Company


4.    Trust


5.    Superannuation Fund (for investing only)

Each of the above has its advantages and disadvantages.

Under the Governments new budget it will now be possible change structures providing that you are a Small Business Entity without having to worry about capital gains tax issues.

From a tax perspective consideration must be given to the marginal tax rates and how they interact with the company tax rate.  The company tax rates may seem attractive to those on high incomes, but Division 7A will in most circumstances cause additional tax to be paid at the marginal rates.

Superannuation has the most generous tax rates, particularly when members are in pension phase.  However, access to funds (a condition of release) is generally not available until age 55.

The marginal tax rates

Company tax rates

Division 7A

Superannuation tax rates


If you would like to discuss further please contact us:
McNamara & Company - Chartered Accountants, located minutes from the Melbourne CBD
Phone +61 3 9428 1062

Please refer to disclaimer at the bottom of the page.