Home' Border Enterprise : Summer-Autumn 2011-2012 Contents enterprise
Vol 5. Summer/Autumn
Top 10 Issues
These are some of the most
important things you should
know if running a business
1. What's an example of negligence in the operation of a business?
Let's say you own a lawn-mowing business and you fail to maintain
your lawnmower. If, as a result of this, the blade flies off the lawnmower
and injures a person, you may well have been negligent.
2. Do I have to disclose a material fact on the insurance proposal
even if it is not specifically asked?
Yes. You have to reveal anything that would affect the company's
decision to offer the insurance contract. Often a proposal will contain a
question like: "Are there any further facts that should be disclosed?"
3. If I am the only employee of my company, and the company
owns the car I drive, does the company have to pay fringe benefits
FBT is levied against companies in relation to benefits received by
employees above wages/salaries and superannuation. The law changes
regularly. To check whether a particular benefit is covered, talk to your
accountant or contact the Australian Taxation Office.
4. What can I do if my employee won't give me his tax file number?
How can I deduct his tax?
You must get advice from the Tax Office, but in general you will be
obliged to calculate tax at the top marginal tax rate.
5. Do I have to accept an offer to pay a debt from a customer in
No, but it might be a good idea if you don't want to go to court and
the debtor is making a genuine effort to pay the debt.
6. Is superannuation tax deductible?
Generally, superannuation contributions are tax deductible in the
financial year in which you pay them, up to certain limits.
7. Can I sue a supplier for unconscionable conduct?
You may be able to if you can prove unconscionable conduct. The
Trade Practices Act gives small business the same sort of protection
offered to consumers.
8. I have been asked to be a company director. I guess there are
no problems in doing this since I don't actually run the company.
There are plenty of reasons to consider your liability! There is an
increasing trend towards holding directors personally liable for actions
where the director has no direct control over the company. See a
lawyer. And think about insurance e.g. indemnity insurance -- get
9. If I declare bankrupt, can my wife's' assets be sold?
Your wife's assets belong to her and cannot be touched, however
you need to be careful about gifts to your wife. If the gift has been
made within a period designated by law, then the gift can be revoked
and used to pay creditors. See a lawyer.
10. What are the main disadvantage of bankruptcy?
Firstly, most of your assets will be sold. Secondly, it may affect your
ability to get credit after you are discharged. Thirdly, you may find that
employers view bankruptcy as a negative character trait - bankruptcy is
not covered by discrimination laws.
Read this: This fact sheet is intended to be general information about
the law in Australia. It is not a substitute for legal or other professional
advice. Lawscape Communications Pty Ltd and Fairfax Media Pty Ltd
do not accept responsibility for loss to any person, who either acts or
does not act because of this fact sheet.
© Lawscape Communications P/L
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