Question:
I have just started a new business within the mlm (network marketing) industry and I would like to know at what point do I start paying tax and what forms do I need to fill in? I currently am working in a full time position so how does this affect my current tax rate?

Answer:
If you have already started your business, I presume you have already registered a business name and obtained an ABN? Have you registered for the GST? If not, I suggest visiting the Government’s Business.gov.au web site where you can register a business name and apply for an ABN.

You should also check out the ATO’s site which will help you understand your obligations and it also has a forms section. If you are working full-time for someone else as well, I presume they are deducting personal income tax from your gross pay. Depending on how much “extra” you are earning, you may want them to withhold additional tax.

You really need to sit down with your accountant and make sure that the structure of your business is tax effective for your current situation. Remember, even if you are operating as a sole trader, you still need to declare any extra income in your personal income tax statement and this extra income may put you in a new marginal tax bracket.

Filed under: Starting a Business, Accounting & Tax
This page was added on 3 January 2002, last updated on 23 October 2006.