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How do I withdraw profits from my business?


The reason we establish and create a successful business from years of sweat and sleepless night is to improve our quality of life and to build future wealth. So, when your business becomes successful, cash is rolling in, and you have a healthy business bank balance, the next step would be to achieve your desired lifestyle funded by the fruits of your labour.

You will find a lot of advice out there, both expert and non-expert opinions. Even your gardener may add his 2 cents. However, the best advice is that of a professional accountant as we can look at your whole financial data and take into consideration any tax savings.

So, the golden question is, how do I withdraw money from my business under a company or trust structure?


Effectively there are three main ways to withdraw money from business:

1. Paying yourself a wage/salary like an employee– The process is exactly similar as you would have been working for someone else or as for your own employees. When you pay yourself wages, you will need to ensure PAYG is deducted at the correct rates and that superannuation is also accounted for.

The most important question to determine here is the annual salary to pay yourself. Here you will need to consider any tax benefits as well as your own personal situation, for example, how much you need to run your household, etc. It is a good idea first to speak with your accountant as they can help determine the best pay rate.


2. Dividend/Trust distribution – Depending on the structure, you can either issue a dividend or trust distribution at the end of the year. If you are running your business as:

a. Company- you can issue dividends to the shareholders of the company which is generally the owners of the business. With dividends the advantage is you can attach franking credits (that is the tax already paid by the company), so an income is not taxed twice. Another advantage is there are no super or PAYG requirements; however, the dividend becomes part of your assessable income as an individual.

b. Trust – if the trust makes a profit at the end of the year, generally, we accountants prefer to distribute the profit; otherwise, trusts are taxed at a higher marginal tax rate. Depending on what type of trust you created, the trust deed will decide the beneficiaries who are entitled to the profits. You still need to have a resolution at the end of June to determine the beneficiaries who are entitled to profit distribution. Again, the profit is taxed on the individual marginal rate.


3. Loan Repayment– When you initially started your business, you needed funds for working capital to cover the start up cost. Let’s be honest the banks do not favour small businesses with start up loans, so you as a small business owner must act as a bank for your business. When you provide personal funds to cover the business cost, it is treated like a loan. Meaning the business owes you money, and you can recover the money back (loan repayment) once the business can afford to pay back.

A Loan repayment is treated as tax free for both the owner and company/trust. There is a possibility like banks to charge the company/trust interest for lending your personal funds to the business. But then the interest income is taxable to the owner.


Whenever you think of implementing the above three strategies, it is wise to speak with your accountant. And if you don’t have one, we are available to explain all tax and accounting matters in simple English.



Written By
Arpana Patel
Tax Accountant

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First Australian Recession in three decades set to be confirmed.

JobKeeper 2.0 Extended till March 2021 to support the economy.

Recently announced, the government is extending the Jobkeeper grant till March 2021 to support targeted businesses adversely affected by the COVID.


Jobkeeper 28th of September 2020 to 3rd of January 2021

From 28 September 2020, businesses and not-for-profits seeking to claim the Jobkeeper Payment will be required to demonstrate that they have suffered an ongoing significant decline in turnover using actual GST turnover (rather than projected GST turnover).


From 28 September 2020, businesses and not-for-profits will be required to reassess their eligibility with reference to their actual GST turnover in the September quarter 2020. They will need to demonstrate that they have met the relevant decline in turnover test in September quarter to be eligible for the Jobkeeper Payment from 28 September 2020 to 3 January 2021.

The Jobkeeper rates for this period are reduced to $1200 per fortnight for full time employees and $750 per fortnight for part time employees.


Jobkeeper 4th of January 2021 to 28th March 2021

From 4 January 2021, businesses and not-for-profits will need to further reassess their turnover to be eligible for the Jobkeeper Payment. They will need to demonstrate that they have met the relevant decline in turnover test with reference to their actual GST turnover in December quarter 2020 to remain eligible for the Jobkeeper Payment from 4 January 2021 to 28 March 2021.

The Jobkeeper rates for this period have been further reduced to $1000 per fortnight for full time employees and $650 per fortnight for part time employees.


Definition of Full time and Part time employees

To determine which employees are eligible for the different rates, the basic rule applied by ATO is:

  • Fulltime- Four weeks of pay periods prior to 1 March 2020 worked on average more than 20 hours / week. Active Business participant in the month of February 2020 worked more than 20 hours / week
  • Partime – Four weeks of pay periods prior to 1 March 2020 worked on average less than 20 hours/week. Active Business participant in the month of February 2020 worked less than 20 hours / week.



Eligibility tests to be passed:

Eligibility Tests

PeriodActual GST turnover decline (15%/30%/50%)
28 September 2020 to January 2021September 2020 quarter (July, August and September 2020) (Compared to 2019)
4 January 2021 – 28 March 2021• December 2020 quarter (October, November and December 2020) (Compared to 2019)


The amount of the JOBKEEPER payment from the two tiers are:

PeriodFull Time*Part Time
28 September 2020 to 3 January 2021$1,200$750
4 January 2021 – 28 March 2021$1,000$650
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Small Business Advisor Finalists

Finalists in top finance industry awards


Melbourne entrepreneur Arpana Patel named as finalist for Small Business Advisor of the year 2020

Melbourne business woman and overnight entrepreneur Arpana Patel of Avenue Accounting Services, has been named a finalist in the Small Business Advisor category of the AMP Women in Finance Awards, announced on August 3rd. The Awards are dedicated to recognising the outstanding women shaping and influencing the financial services industry.

“This really is a huge honour for me, as I never expected to be recognised for an award like this,” explains Ms Patel. “My choice to become an entrepreneur and start my own Accounting and Taxation business was really made for me and it happened overnight.  My marriage had ended and with two young children to care for, I had to act fast. I had to shift my mindset and take a leap of faith and start my own business.”

Arpana wants to help lead change and be an example to others who may be facing similar challenges in their lives, she faced some individual challenges including having to care for her child with special needs whilst establishing and managing her business.

“There are a lot of barriers and stereotypes that women experience. I want to help change that. I want to show others who may be facing adversity that you can turn things around, you can create new possibilities and achieve great things if you set your mind to it.”

Although Australia has made significant strides towards equality, women still continue to experience inequality in many aspects of their lives.  Women and mothers who experienced hardship due to marriage breakdown, job loss or health issues are often at a higher risk of financial insecurity and more likely to experience financial distress.  When asked about the importance of financial security, Ms Patel explains that her services help to ensure small business owners can improve their financial literacy and achieve their financial goals.

“Great client service, transparent pricing and tailoring a solution to the unique needs of our small business clients are some of the reasons our business has grown since it was established in 2014,” says Ms Patel. In recent times with the rise of the global pandemic Avenue Accounting Services have continued prosper despite a difficult business environment.

AMP Women in Finance Award Winners will be announced via a live broadcast on Thursday 10th of September 2020 at 6pm.

For more about the AMP Women in Finance Awards, visit:


Media Enquiries:  Please contact Small Chilli Marketing

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We have been awarded the ATO lodgement certificate for 3 years in a row.

As a registered tax agent, AveSol Accounting plays an important role in helping taxpayers
meet their tax and superannuation lodgment obligations. To help us manage this workload,
ATO provides a lodgement program that accommodates progressive document lodgment over
a 12-month period.

The lodgment program framework promotes a level playing field among registered agents by
benchmarking lodgment performance.

The framework recognises agents who:

  • have good practice management
  • lodge electronically
  • are consistently on time.

AveSol Accounting Services is proud to be meeting the 85% on-time lodgment performance benchmark for the last 3 years in a row. We are proud that our firm is maintaining the integrity of our clients and actively engaging them with the tax system through education, advice, and assistance.

AveSol accounting services is determined in future to maintain the same level of achievement and assist small businesses in meeting their tax and super obligations.

View Our certificate here

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Home Office Expenses

The business world has come a long way and there are many options now available in regard to workplaces and how the work is completed. Many businesses are now becoming a lot more flexible with their working options and are starting to offer the option to work from home.

This can be an ideal situation for many people who are unable to get into the office each day due to having children, travel concerns or disabilities. Working from home can be very beneficial for the workplace and can improve productivity.

If you are someone who works from home on a regular basis it is important to know what you can claim in expenses. Expenses are the costs that are made for different items. If you are working from home, there are a number of expenses that you can claim.


Running Expenses

If you work from home on a regular basis you may be able to claim a percentage of running costs that are incurred within the home. These running expenses can include; electricity, internet, furniture costs and the decline in their value, the cost to repair these items if needed and consumables such as printer ink, paper and stationery.

These can only be claimed in a percentage since you are not using the total cost of these towards your work time. You need to calculate the amount of time that these running expenses are used for a work basis.


Phone and Internet

If you are using your personal mobile phone or home phone for work purposes, you are able to claim a percentage of the cost of these as a business expense. The same goes for if you are using your internet for work purposes as well.

Once again you do need to calculate the amount of time that these items are used for work purposes and work out the percentage that you are able to claim. If you are claiming more than $50 for the expense of these, do you need to keep paper records of the amount of time that they are being used for work purposes and keep copies of the total bill amounts.


How do I claim running expenses?

If you want to claim at a fixed rate you can use a standard rate calculation of 52c per hour to calculate the amount that you are able to claim. This covers the cost of all running expenses and the total is used to calculate the amount that you can claim back. You need to document at least 4 weeks of running expenses in order to create the overall amount of time that you can claim over the year.

If you want to calculate based on actual hours, you firstly need to have a dedicated work area such as an office in a separate room of the house. From there you then need to work out the floor measurement of the room to give the percentage of the house that is being used for work purposes.

The running expenses for the house can then be divided so that you can determine the amount that is relevant to that dedicated room of the house. This is the overall amount that you are able to claim on running expenses.


How do I claim phone and internet?

There are a few ways that you can calculate the amount you can claim. If you are claiming under $50 that you can do a fixed rate for the number of phones calls the phone is used for.

If you want to work, it out based on actual usage this can be done by breaking down your itemized bill and selecting the times and calls that are used for business. If you do not receive an itemized bill than you will need to record the time the phone and internet is used for over a 4-week period in order to determine the amount you can claim back as an expense.


Claiming expenses where you can will help with your financial position and help lower the burden of working from home. If you are unsure on the rates, please talk to your Accountant.

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