Do you have a hobby-business?

Is it a Hobby or a Business?

A hobby is a spare-time activity or pastime pursued for pleasure or recreation; and
A business generally requires some form of investment and enough customers to whom its products or services can be sold on a consistent basis with a profit-making intention.

The distinction between a hobby and a business is important as the carrying on of a business requires a taxpayer to: declare sales income, claim tax deductible expenses, keep accurate records, register for an ABN and register for GST if turnover reaches $75,000 or more in the financial year.

If you are merely pursuing a hobby, you do not need to report the income from the hobby.

Go to my website for access to the Tax Office’s guide to determine whether your activity is a hobby or a business, or contact me for assistance.

Is Your Business Viable?

Is your business viable?

Viability is defined as the ability to survive.
For a business, this is linked to financial performance and position.
A business is viable when either:
• It is returning a profit that is sufficient to provide a return to the business owner while also meeting its commitments to business creditors.
• It has sufficient cash resources to sustain itself through a period when it is not returning a profit.

If you are thinking of starting a business, it is important to do your market research, prepare a budget and forecast projections, as accurately as you can. If you are already in business, you have some figures to analyse to determine your business viability.
Please contact me for assistance.

Employee/Contractor Decision Tool

There is a Decision Tool on the Australian Taxation Office website designed to help employers understand whether their individual workers are employees or contractors, in order to comply with tax and superannuation obligations.

Once you have answered a series of questions you will be provided with a report which will give:
• A decision of employee or contractor
• A summary of the information you have provided
• The basis of the decision and
• A summary of your taxation and superannuation obligations relating to the worker.

You will remain anonymous at all times. No personal information will be transmitted to the A.T.O.

Please contact me if you would like to assess your employer obligations.