Talking Cents

Sydney small business accountants loving their BAS

For some small business owners and entrepreneurs in Sydney and across Australia, running one small businesses just isn’t enough, so they have multiple businesses across a variety of industries… after all variety is the spice of life.

Take for example the IT expert that decides to run a local café while also sticking to their core profession of IT solutions. For the average small business owner that does not have other non-related third party financial investors, it is often a more streamlined legal and taxation strategy to operate the business under the one umbrella structure, whether that be a partnership, company or more complex trust structure.

Whilst this is all well and good, it always pays to know how each business is tracking and keeping separate bank accounts and accounting systems under the one entity is preferable.

One way for small business owners to keep track of each businesses tax obligations is to register multiple GST branches and prepare a separate BAS for each business within the structure. The ATO criteria for being eligible for GST branches are:

• Each branch must have its own clearly defined system of accounting
• The branches can be clearly separated and identified as unique businesses
• The entity is actually carrying on a business and not just a hobby
• The entity is not a member of a GST group. (GST grouping is a separate issue for another day)

By operating your businesses in this way, you as the business owner will have a much clearer understanding of each business as a distinct operation as well as being able to build a better overall consolidated picture of your financial and business assets. The key here is setting up your financial systems correctly from the outset in such a way to minimise the time spent on preparing useful and relevant information. By doing so, you allow for more time to focus on actually using the key date to make useful business decisions rather than being bogged down in the nitty gritty of sorting through mountains of paperwork.

For more information on how GST branches can help you run your small business contact mas accountants, the original accounting office for small business.