Registering a Company / Principle Place of Business ??

I had a few questions that I need some guidance on regarding starting a company structure for my business operations. My situation is as follow:

- I currently live with my parents paying board.
- I am wanting to turn my "side hustle" into a legitimate business operation.
- Sole Trader structure would be fine for now, but have a long-term view and am bullish on the business potential.
- I work full-time and have no desire at this point to stop doing so.
- My entire business is/will be online, strictly e-commerce.

My questions mostly revolve around registering a company and the Principle Place of Business question. As I said I live with my parents who own their home, and I was just worried about any potential impact on their taxes payable. For example, if they sell their home which they plan to inside the next 12 months, would my business operations affect them ? Or are their any other considerations to listing their address, which I also live at, as the Principle Place of Business ? Also, my business will be an e-commerce operation where no physical address will be used to conduct business operations, and no expenses in that area will be claimed. Any points would be much appreciated

 

No connection to their taxes unless they are employed or receive income of some sort.

 

Thank you Terry, appreciate the response. I thought that would be the case, just didn't want to do anything to affect them.

 

The main residence exemption is not that wide. For example it does not apply to a person's Pty ltd company operates from home

 

Tax Tip 91: A Non-owner running a business at home Tax Tip 91: A Non-owner running a business at home

The test is whether the owner could claim the interest on a loan used to buy the property. If they are not operating the business themselves they could not generally. But if the company has a lease agreement with them for part of the premises they could claim the interest, in part, and could be up for CGT when selling.

 

So if I was leasing part of the property specifically to operate my business as my working office and I consequently claimed that as a business expense, then it could have some effect ? I do not plan to do this at all, just live here, and in order to register the company, will use the address.

 

Definitely.

 

A related party "lease" seems dubious and is likely a private expense. You said : I currently live with my parents paying board. You want to reclassify this as a business expense ?
My suggestion - Focus on the buisness outputs and dont focus on being too clever with costs like that.

 

I have no intention to do so.

 

Just so that I am crystal clear: If I use my parents PPOR as the principle place of business for my company - it will not have any impact on their taxes nor the cgt exemptions associated with their PPOR at the time of them selling? I don't plan to claim any expenses on this address whatsoever. Thanks.

 

Seek your own legal advice but I don't see how it could.

 

Came here to post a similar question and found this thread.

My question is more about privacy. If you run a service-based company from home are there any ways of not listing your residential address as the principal place of business?

The service is providing advice, so can be conducted anywhere, including remotely or the client's home but the administration side of things would be done at home.

 

You could list another address.

I had a client who was being chased by bikies and he somehow managed to get ASIC to conceal his address. Not sure how.

 

yes - use The address of a serviced or virtual office.

 

Could it be assumed he or she didn't use your address, as I assume the story would have a little more flavour?

 

This is for the business’ principle place of business.

What about the residential address of the director? Can you nominate a commercial address for that?

 

not legally

 

This thing that you can check the address for side hustle businesses which are usually run from home is pretty bad. Even if you don`t operate in a risky industry there are still chances to find one crazy customer ASIC will let you hide your address only under specific request and if you operate in a risky scenario. There are 3 addresses you need to nominate: name holder residential address, address for service of documents, principal place of business. I have used a virtual address (different State too) for all of them. As Terry said not 100% if is legit to do it for the name holder. Anyway, do you think I can still claim expenses for running the business from home?

 

There is no connection between the 2. If you are running a company at home but you have listed the local mcdonalds as you home address it doesn't change the tax outcome.
For the company to claim part of the rent, assuming the rent is a deductible expense to it, the company would need a written lease agreement.
It cannot just claim part of your rent and you cannot just claim part of your rent for running a company as it is a separate tax entity.

BTW The 4 addresses needed are
a) Registered Office of the Company
b) principal place of business of the company
c) home address of the director
but also
d) home address of the shareholders.

 

Thanks, is this valid for Sole Traders too or in this case the shareholder's address is not requested?