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It’s important to separate your business assets and personal assets when building your business. However, it can be easy to set aside and think that it isn’t a big deal. The truth is, it can be pretty risky.

Protect your personal assets against business liability. It is more than just getting insurance or a once-and-done exercise. Talk to a small business accountant as this is a long-term commitment. We’ll let you know the best asset protection strategies for your personal and business needs.

Small business accountant

Even if your business is doing well, you can’t control the future. Your investment may drop in value or clients may not pay you. There may even be a pandemic. These can lead to a reduced revenue and a struggle to pay creditors. Avoid seeing your business facing a lawsuit but if it happens, make sure your personal assets are separate and protected from your business assets.

Ask your small business accountant to identify your business and personal assets. These are your family home, vehicles, personal collections, land, investment properties and even business name.

The most common asset protection strategy is setting up a family trust for your personal assets. When a family trust holds your assets, the assets will be owned by a trustee who will be liable for any action against the trust. Your company may be the trustee so in case of financial issues in the business, only the assets in the trust and the business can be used to pay creditors. The beneficiaries are you and your family and are not owners of any of the assets. Your personal assets will be screened from liability. You will also be able to distribute income more tax-effectively.

Company or sole trader insurance

Small businesses often start as a sole trader but you can protect your personal assets from business risk by creating a company structure for the business. A company is an independent legal entity run by directors and owned by shareholders. Company directors can face debts and shareholders can be liable up to the amount of their unpaid shares which is often zero. Ask your small business accountant about this if you’re interested.

Make sure all insurances are in place to cover you and your family in case anything happens, including income protection insurance, life insurance, total and permanent disablement insurance and trauma insurance. Speak with your small business accountant for peace of mind. Your accountant should review your insurances regularly and make sure these match your needs.

Another way to protect your assets is by creating a will. It identifies which ones are personal and business assets and which beneficiaries will receive these. This is where you state how you want to distribute your wealth. A small business accountant can help you set up a testamentary trust in your will. Assets will be owned by this trust – not you, your family or business. Any business liability cannot be chased through the trust’s assets.

There are several ways to protect your assets. Contact an accountant with the right business knowledge and expertise to do this correctly.

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As you look for different ways to grow and improve your business, seeking professional advice could prove to be an important and helpful decision.

You can click here to speak to a businessaccounting and bookkeeping firm. We also offer hospitality business consultation and mortgage services. We will give you a call to know more about your needs. We will explain to you how we can improve your business.

We would love to help you formulate investment strategies and streamline your processes to take your business to the next level.  Our goal is to help you grow your business, find ways to invest more and increase your productivity.

 

 

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Contractor Accountants: Tax, Accounting and Bookkeeping for Contractors

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As you look for different ways to grow and improve your business, seeking professional advice could prove to be an important and helpful decision.

You can click here to speak to a businessaccounting and bookkeeping firm. We also offer hospitality business consultation and mortgage services. We will give you a call to know more about your needs. We will explain to you how we can improve your business.

We would love to help you formulate investment strategies and streamline your processes to take your business to the next level.  Our goal is to help you grow your business, find ways to invest more and increase your productivity.

Sky Accountants Ballarat

Construction Accountants

Phone: 1300 328 855

Office Address: 902 Howitt Street, Wendouree, Victoria 3355, Australia

Postal Address: PO Box 2234, Bakery Hill, Victoria 3354

Sky Accountants Gisborne & Macedon Ranges

Phone: 03 97444522

Office Address: 45 Hamilton Street, Gisborne, Victoria 3437, Australia

Postal Address: PO Box 270 Gisborne Victoria 3437