SMSF Guide for Business Owners

Oct. 28, 2019 - PRLog -- Business conditions can quickly change and the shifting market can make it hard for you to get the price you want. Business owners who contribute to their own superannuation avoid the risk of being reliant only on exiting their business with a sale. If you contribute to your own super, you may generate wealth for a comfortable retirement and have peace of mind knowing you're securing your future.

Superannuation can be a secondary thought for business owners but Sky Accountants will provide you with in-depth support and guidance to help you with your super. If you run your business as a sole trader, partnership, trust or company and you pay yourself from the profits it makes, you don't have to pay yourself superannuation. However, if you pay yourself a wage, it is ideal to pay your own super because it places you on the PAYG system – hence, you pay super and tax during payroll runs. It is not an obligation but it is highly recommended except when the business is just starting out because at this time, you still need to reinvest all the money back into the business.

Business owners are recommended to make allowances in the business budget to pay super at regular intervals. Super for business owners is a good way to build long term wealth and prepare for a comfortable retirement. It can also be a back-up plan if your business goals are not met or if you don't get the selling price you want for your business.

If you pay yourself a wage, you have to pay the minimum 9.5% obligation on top of your wage quarterly. If you pay yourself from the profits of the business, you're not really obligated to pay yourself a super contribution but it would be good to pay yourself a super contribution from these profits into a nominated super fund before the end of the financial year.

As a business owner, you can claim a tax deduction on super payments and minimise the overall tax bill for your business. You can build you wealth in a tax-protected environment. If you pay super as part of your wage, your business can claim it as a tax deduction because it is classified as a business expense. If you pay super from the profits of your business, it will be a personal tax deduction in your personal tax return. You just need to submit a notice of intent to claim or vary a deduction for personal contributions through your super fund first. In case the business has multiple owners who make different choices about superannuation contribution, personal super contribution is recommended.

Talk to us (https://www.skyaccountants.com.au/contact/) and create a way that will provide benefit for the long term.