Tax Advice needed (sole trader abn)

[nathanVY]

Hey everyone, how are we today?

Just a couple of things i'm unsure about and I thought to myself there must be someone on here with the required experience and knowledge that could possibly spare 2.7 minutes to reply to this thread.

So I currently work 6 days doing various kinds of contracting work under my on ABN which is in my name not a business name. I know a bit about the system and how it should work, but not enough

my work has only recently picked up to become full time hence needing to make sure i'm doing it right.

- what is the tax free bracket?
- any rough estimates on how much I should be putting aside? (going to make a savings account with a separate bank) I heard someone 20%? sounds pretty steep
- can anyone recommend a good accountant around the geelong area?

Comments, thoughts & advice would be much appreciated. No you are not giving me financial advice as that is illegal, just throw some ideas or tell me what works for you

 

[minux]

Small business forums Australia - where solo & micro businesses connect

Tax free threshold is 6k? Then you have incrementing tax brackets. Keeping 20% of tax is not enough. You should put aside the entire amount each week for what your declaring as salary.

Seriously, that forum link will help you more than here. Has certainly helped me immensely. I'd also suggest using one of their business coaches around the forums, best money you can spend.

 

[nathanVY]

Thanks minux, will check it out.

Keeping 20% of tax is not enough. You should put aside the entire amount each week for what your declaring as salary.

I'm sorry I don't follow, sounds like you're saying put everything towards tax :S

 

[minux]

Thanks minux, will check it out.



I'm sorry I don't follow, sounds like you're saying put everything towards tax :S

Sorry, I meant you should work out what you should pay in tax correctly, 20% will leave you well short. Google ATO tax calculator, that will tell you exactly how much tax to withhold per week/fortnight/month on any given earnings.

 

[sheepz]

You should be setting a side all GST that you collect from jobs as a start, as the gst you collect isn't yours to play with. the 6,000 threshold is for personal tax only. You'll be looking at about 30% tax or 30cents per dollar you make. Check with an accountant to be 100% safe

 

[minux]

You should be setting a side all GST that you collect from jobs as a start, as the gst you collect isn't yours to play with. the 6,000 threshold is for personal tax only. You'll be looking at about 30% tax or 30cents per dollar you make. Check with an accountant to be 100% safe

He only has to collect GST if he earns under 75k a year. He can elect not to collect, that said it also means he cannot claim gst credits.