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LETS GET DOWN TO BUSINESS.

Question :
Hi, I am thinking about starting up a Cleaning Business – private homes and B&Bs.How do i get started with taxes, acc and all other costs.I know I can get customers but dont want to be paying most of my $$ in taxes.

Question submitted 20/07/20 @ 04:25pm
Industry: Funding & Finance
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  • Good morning Kirsty – good on you, paying taxes is unfortunately a part of life, and keeps us all in with services, but I get you, getting the best tax rate for your business and stage / scale is super important.

    A few things –
    ACC, you can’t avoid this, and for your business there will be a ‘classification’ that you are required to pay on a formula.

    GST, there is a minimum threshold below which you don’t have to pay or claim GST back, from memory (please check) it is $60k, so you don’t have to worry about that if you are going to be earning less than that or spending less than that. Typically for contractors they earn more than they expenses in GST services, so not being GST registered can mean you ‘net’ more income, unless you are expensing some equipment in the early days like a car or big cleaning equipment which might give you a one-off GST claim on that expense.

    Income Tax, if you are a company (registered) then you pay a flat rate while as an individual there is a sliding tax rate depending on your income – to start with, you may find the tax rate for income to you is lower. Do a google on these to see.

    Hope that helps. Andy

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