Choose Your Business Structure

There are a number of alternative structures by which a business can be owned, as follows:

  • Sole Trader
  • Partnership
  • Discretionary Trust
  • Unit Trust
  • Company

There can also be combinations of the above, for example, a Partnership of Unit Trusts, and Hybrid Unit / Discretionary Trusts. Also, once the structure is decided, further consideration is required of;

  • Who will own the equity in a partnership, Unit trust or company?
  • If the structure involves a company, who will act as directors?
  • If the structure involves a trust (any type), who will act as the trustee of the trust?

Decisions surrounding the structure are usually based around the following criteria.

  • Flexibility in adding or removing owners
  • Capital Gains Tax outcomes on sale of the business or other capital assets
  • Income tax paid during the operation of the business
  • Flexibility in the remuneration of owners
  • Cost of maintaining the structure
  • Ability to understand the structure and hence not transgress various laws
  • Asset protection of personal and/or business assets

Bentleys is able to assist you in making a decision regarding business structure after gaining an understanding from you of how you want to operate the business and where you see the possible future for the business, with the above criteria in mind.