Forum Topics Company or Trust...What's the best business structure for trading?
reddogaustin
Added 5 years ago

Hi All,

As you are aware, it is all context dependant to you; your particular situation, goals, relationship situation, capital involved, tax etc. This is why most people will advise you to pay money to a trusted lawyer and tax agent for them to help you, remember you have to spend money to make money.

Basic information on the differences you can google for yourself - this may help you understand your personal context and inform/change your goals etc. During this research, you can also keep a list of questions for the lawyer and tax agent. This ensures you get your money's worth from them, and sets you up to know whether they are forcing a different idea on you or listening to your proposal and assisting your goals.

I think you may be better off offering up a 'de-indentifed context' and seeing if there are similiar individual examples or case studies from members.

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Benhart
Added 5 years ago

As I understood from your post, you work remotely from home. If so, you may be eligible for outsourcing services from a company like Sphereit. This company offers high-quality IT support and other services to businesses large and small that want to keep their data and network security assured. A specialist like https://sphereit.uk will give you the help you need to run your business securely while saving you money on specific IT services. Whether you are looking for a replacement for an aging computer or adding new software to an existing network, they will help you.

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TrendTrader
Added 5 years ago

Hello to the community! I'm the new guy :)

Any full time traders here?

What is the best business structure for traders?

Company or Trust? I'm interested to hear everyone's thoughts.

Obviously this is not to be considered as financial advice but I would love to here the pros and cons of each.

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Hands
Added 5 years ago

Why pay an extra $1000+ each year to register a company and pay accountants for tax returns and audited financial statements whom nobody will ever read?  Then there's the whole independence/auditor issues as well, adding further costs to your setup.

Go individual name.  Customer Service Reps at trading platform houses have better knowledge of "simple" setups.  Don't try to talk to them about trusts and trustees and pty ltd holding companies.  Everything takes 5 times as long! 

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Rick
Added 5 years ago

Depends on your circumstances a lot. The world is your oyster if you have a SMSF, reach preservation age,  stop work, start a drawing a retirement stream. You can do any trades you like and pay absolutely zero tax on your capital gains! It might be a long way off for many, but worth planning for early.

Even before retirement phase there are benefits from trading in an SMSF, including the the one-third discount rule. If an SMSF sells an asset it has owned for at least 12 months, the ATO indicates the fund may be entitled to ‘discount’ the capital gain by one-third, so only two-thirds of the gain would be subject to tax. This means an SMSF pays an effective tax rate of 10% (15% minus the one-third discount) on capital gains where the discounting rule applies.

SMSFs offer many benefits to savvy share investors/traders. Once you have enough super to consider starting your own SMSF, it is definitely worth considering for the long term and seeking advice on how to get started. I also recommend maximising your concessional super contributions each year, and if you can afford, add non-concessional contributions along the way also. You can also transfer shares from your personal account into your SMSF as a contribution. These are called 'in-specie' contributions. Unfortunately you are still subject to capital gain tax on the market value at the time the 'in-specie' contribution is made.

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