Does your accountant make money for you that you can spend on the things that you really want to? What would an extra $66,000 do for your family, holidays, paying school fees or just paying off your mortgage?
Most accountants are NOT proactive and never come up with ideas on how to save their clients tax. I am the opposite. I had one client recently who runs a small business who had losses trapped in a separate company. Through restructuring I was able to get those losses out in full over the next 12 months so they can be off-set against their business income and save them $66,000 in tax. Thats real money made that they would otherwise have to pay. This is what I did:
- Ensure that the losses in the separate company could be carried forward under the Business Loss Forward Rules (Same Ownership Test).
- Create a management agreement between them and their two companies to ensure the losses could be utilised in a legitimate manner. (Vital)
- Implement full arms-length monthly invoicing to ensure commercial reality to the agreement.
- Checked that they had credit loan balances in their loss company so that they could get the cash out tax free as loan repayments not wages.
If all this sounds too confusing then leave it to me. This is what I do as a proactive accountant for my business clients.