If you run a small business and are unhappy with the way your affairs are structured – that is, you are unhappy operating as a sole trader, partnership, company or trust and think alternative arrangements would be better – or you are simply rethinking how you are doing business, now is a good time to make a change.
From 1 July 2016, small businesses (less than $2 million in turnover) can restructure their affairs without necessarily triggering tax consequences. This is a significant change because, in the past, such changes could very easily have had substantial tax consequences.
As such, getting things right from the start has always been important. The main change since I wrote that piece is that structuring is not something you have to get right from day one.
However, as is always the case with tax, you must be careful about how you restructure so as not to trigger unintended consequences. But as long as you follow the rules – or ‘swim between the flags’ as the ATO likes to say these days – you can make a change.