As your business grows, so do the risks of staying in the wrong structure.
Missed tax savings, extra liability, and outdated ownership can erode the wealth you’ve built. Many owners haven’t reviewed their structure since the early days, and it’s costing them.
Our chartered accountants in Sydney, NSW, work with business owners across various industries, including professional services, healthcare, hospitality, manufacturing, and more, to achieve tax efficiency, asset protection, succession planning, and growth.
If you’re wondering whether restructuring could cut your tax, this guide outlines business restructuring tips, common traps to avoid, and how to get it right.
Most structures are set up fast when the business is small. But what worked then can now hold you back.
Here are some common triggers that signal it’s time for a review:
If profits are up, you now employ staff, or you’re reinvesting heavily in growth, a sole trader or basic company setup may no longer offer the flexibility or protection you need.
Adding a partner, spouse, or new shareholder changes how profits are taxed and decisions are made. Restructuring can give you clearer control and smarter income splitting.
Restructuring can protect your personal and business assets, make succession easier, and reduce tax when it’s time to sell. But many of the most generous tax concessions — like capital gains tax discounts — are only available if your structure has been in place for a certain period or meets specific conditions. If you wait until you’re ready to exit, it may be too late to access them.
Yes — when done correctly, restructuring can significantly reduce your tax burden while improving flexibility and protecting assets.
Here’s how:
Discretionary (family) trusts or corporate beneficiary structures let you split profits with family or related entities in lower tax brackets, reducing your overall tax.
Using a corporate beneficiary or “bucket company” allows business profits to be taxed at the corporate tax rate (25%) rather than top marginal rates (up to 47%). However, it’s important to note that passive or investment income streamed to a bucket company is taxed at 30%. You can keep or invest funds in the company, but you need to manage Division 7A rules carefully.
A quick note on Division 7A:
If you use company funds for personal expenses or make undocumented payments, Division 7A can treat it as a dividend, triggering additional tax. Get expert advice on your situation to help you avoid these traps.
Moving assets into the right structure can unlock small business CGT concessions like the 15-year exemption, 50% reduction, or retirement exemption.
CGT outcomes can differ depending on the structure used, so it’s important to plan ahead and get advice tailored to your situation.
For example, trusts can offer added flexibility in distributing capital gains to beneficiaries, potentially lowering the overall tax payable. However, with the right planning, these concessions can cut or even wipe out capital gains tax on future sales.
The most common business structures are sole traders, partnerships, companies, and trusts. Each has unique advantages and considerations, and we can help you determine which is right for your business.
Setting up a company involves registering with ASIC, creating incorporation documents, and establishing operational guidelines. Our team simplifies the process, ensuring compliance and efficiency.
A sole trader operates under their name without separating personal and business assets, while a company is a separate legal entity offering greater asset protection but with additional compliance requirements.
Yes, as your business grows, we can help review and restructure your company business structure to align with your evolving needs.
Asset protection safeguards your personal wealth from potential risks, such as litigation or financial losses, ensuring long-term financial security.
Restructuring in New South Wales comes with its own quirks. Local business owners can get caught in state-level tax traps — especially when transferring property.
Transferring real estate or business assets in NSW can trigger stamp duty, even if no money changes hands. Exemptions are limited and need careful planning, especially if you’re moving commercial property into an SMSF, trust, or company.
If your discretionary trust doesn’t exclude foreign beneficiaries, you could face surcharge land tax, even if all your beneficiaries are Australian. This is a common and expensive mistake.
Some business owners assume that if their restructure qualifies for federal tax relief — like the Small Business Restructure Rollover (SBRR) — there won’t be any tax to pay. While this rollover can defer capital gains tax at the federal level, it doesn’t cancel out state taxes like stamp duty in NSW.
Even if your restructure meets all the ATO’s requirements — such as keeping the same economic owners and running a genuine business — the NSW Office of State Revenue may still assess stamp duty on asset transfers, especially when real property is involved. There are limited exemptions, and they don’t automatically align with the federal rollover rules.
This disconnect is a common (and costly) misunderstanding — and a key reason to get tailored advice from an accounting firm in Sydney before making any structural changes.
When Lombardi Real Estate engaged our small business accounting services, they needed a business structure that would minimise tax and protect their assets. We set up a family trust, appointed a corporate trustee to limit liability, and created a bucket company to lower tax on profits.
In the first year, this structure saved them over $40,000 and gave them peace of mind about their assets.
A tax-efficient business model sets your business up to scale, pass on wealth, and avoid nasty surprises, but timing is everything. Wait too long and you can miss key concessions or pay more in tax, compliance, and/or risk.
Yes. If your current structure no longer fits your business, a restructure can cut tax, protect assets, and unlock smarter growth.
We’ve seen too many business owners put off this review, only to find out (often years later) they’ve been paying more tax than necessary — or worse, they’re exposed to risks that corporate tax accountants could have easily prevented.
Rest assured: a structured, compliant approach can reposition you without triggering unnecessary tax bills — and it doesn’t have to be disruptive.
If you’re not sure your structure still fits, now’s the time to check. We bring decades of tax and structuring experience, plus practical, tailored advice that business owners value.
Book a structure strategy session with our tax accountants in North Sydney to make sure your setup is working as hard as you are.
