According Requirements Optimum Structures â€Myassignmenthelp.Com

Question: Discuss About The According Requirements Optimum Structures? Answer: Introducation This is the most common and simplest structure to form. In this structure all the ownership and responsibilities, lies with owner, i.e. with you in your case. However, the key aspects of this structure are as below: Licensing requirements - There is no requirement of business registration or licensing. Control liability - The owner has all the managerial control with him. However, the liability of proprietor is unlimited and he is personally liable for every liability. Taxation compliance - In this structure, the profits earned or losses incurred are added to the individual income of the owner and taxed as such. Further, deduction with respect to non-current assets like depreciation can be claimed if these assets are used for the business. Further, if there are no employees, then there is no obligation for PAYG deduction or FBT payment. But if the annual turnover exceeds $75,000, then the business is required to be registered under GST. Accounting Method - It can adopt to any method of accounting whether it is a cash method or accrual method. Business name registration- There is no requirement of business registration. However the business name can be registered. If the business is set up in the name of sole proprietor then there is no need to register the business name but if the business is set up with some other name then the business name should be registered with Australian Securities and Investments Commission (ASIC). Ongoing cost With respect to legal costs, the only ongoing cost is of renewal of business name. Reporting requirements There are no reporting requirements. Partnership - Partnership is formed by two or more persons who are willing to start the business mutually. In partnership, they share profit and losses in the agreed ratio. Licensing requirements No license or registration is required for starting business. Control liability The liability of partners are unlimited means their personal assets can be used in case on non-payment of debts. Taxation compliance - The profits or losses shared to the partners are clubbed with their individual incomes and taxed as their income. Further, if there are no employees, then there is no need to pay PAYG or FBT. But GSTN is necessary to carry out the business if the annual turnover is above $75,000. Accounting Method Any method whether the cash method or accrual method can be adopted. Business name registration- There is no requirement of registration of partnership business but the business name can be registered. If the business is started in the name of partners then there is no requirement of business name registration, but if the business is started in some other name, then it needs to be registered with Australian Securities and Investments Commission (ASIC). Ongoing cost Only renewal of business names is required in future. Reporting requirements There are no such reporting requirements, except filling of tax returns with Australian Taxation Officer. References: 'Choosing Your Business Structure' (Ato.gov.au, 2017) https://www.ato.gov.au/business/starting-your-own-business/before-you-get-started/choosing-your-business-structure/ accessed 23 September 2017 'Partnership' (Ato.gov.au, 2017) https://www.ato.gov.au/Business/Starting-your-own-business/Before-you-get-started/Choosing-your-business-structure/Partnership/ accessed 23 September 2017