| Forum Home | ||||
| PC World Chat | ||||
| Thread ID: 98073 | 2009-03-10 08:14:00 | Running a company | george12 (7) | PC World Chat |
| Post ID | Timestamp | Content | User | ||
| 755265 | 2009-03-10 08:14:00 | For the laywers and accountants out there, I have a couple of questions about the starting and running of an LLC (or the converting of my sole trader status to LLC). I have started a limited liability company just yesterday and have been, until now, trading as a sole trader for a couple of years. Firstly, is there any procedure to providing the starting capital other than sticking some money in my company's bank account? Secondly, what are the rules regarding selling my / my current business' assets to the company? I need to sell to it my car, and my current stock. Would I need to contribute capital, THEN get the company to pay me, or can I just "contribute" the goods and have this be my starting capital? Are there any tax implications of how much capital I put into it to begin with? I seem to be putting the capital IN without any kind of tax recovery, but see no way of taking it out again should I want to do so. Can I just loan the company starting capital instead? Regarding GST, would it be allowable for me to deregister myself for GST before selling my business' assets to my new company, thus saving myself having to add GST onto the cost? I have to deregister anyway of course, and technically I am probably voluntarily registered as my turnover this year will probably not exceed $40k ... For my car, which is owned by me, not my business, I assume I will be simply claiming the second hand goods GST credit when my company purchases this? My final question is about loaning money to my company. Say I have $5,000 in the company's bank account and need to make a $10,000 purchase. Can I simply lend my business $5,000 for a month or so? I know the answer is yes, but do I need to charge interest, and is there a "fair" rate it must be? Can I contribute capital at any time without complicated procedures? Finally, is it imperative that company money be kept in company-named bank accounts? Ie, can I "look after" my company's money in my own savings account to avoid having yet another savings account? Obviously this only applies to medium-term money and the day to day transactions are in the business account. |
george12 (7) | ||
| 755266 | 2009-03-10 08:39:00 | The GST threshold has been raised to $60k. Pretty sure this came in on the 1st March. |
CYaBro (73) | ||
| 755267 | 2009-03-10 08:55:00 | My advice is to go and see an accountant. Although it will cost you money, it means you start off on the right foot with the IRD cos you don't want to get offside with the IRD. | dolby digital (5073) | ||
| 755268 | 2009-03-10 09:24:00 | X 2 for the accountant - well worth it. GST - if you charge it you have to pay it to IRD - look at it as a form of IRD tax collection you do for nothing. Bank accounts - my accountant said to me - keep the business and personal accounts separate - that way if anything happens to the business and you go belly up you wont lose any personal items. I personally work from drawings, not wages - my accountant is good - after doing all the sums, esp when IRD changed the rules half way through the year - guess what - no provisional tax to pay this year yeaaaa :thumbs: and I have checked with IRD and they said hes right. |
wainuitech (129) | ||
| 755269 | 2009-03-10 09:37:00 | X 2 for the accountant - well worth it . GST - if you charge it you have to pay it to IRD - look at it as a form of IRD tax collection you do for nothing . Bank accounts - my accountant said to me - keep the business and personal accounts separate - that way if anything happens to the business and you go belly up you wont lose any personal items . I personally work from drawings, not wages - my accountant is good - after doing all the sums, esp when IRD changed the rules half way through the year - guess what - no provisional tax to pay this year yeaaaa :thumbs: and I have checked with IRD and they said hes right . Thanks guys The GST threshold doesn't really make a difference to me . I'll be registered for GST either way as many of my customers are businesses who expect it . I've been registered for a couple of years for that reason and because my turnover has been well over $40k/60k (selling computers tends to do that, lots of turnover for not that much profit) . You can't just take drawings from a company either, gotta pay myself wages or dividends . That stuff is all no problem . I just need to know the rules regarding lending to the company and contribution/selling assets to it . I would be annoyed to have to go see an accountant as I have done fine on my own all this time . My question about GST was whether I'm allowed to personally de-register for GST before selling my stock to my company, so as to not have to add on and pay 12 . 5% of the value of my stock . Then again, maybe I should see an accountant . I don't make a huge amount of money though so I would rather save the expense . I have a fairly good relationship with the IRD and I'm confident in my accounting skills apart from these few issues I can't seem to find information about . . . |
george12 (7) | ||
| 755270 | 2009-03-10 10:39:00 | I think all you would have to do is transfer all the assets from your sole tradership to the LLC and then issue yourself shares for the value of the assets transferred. You can contribute more capital anytime you want. Just issue more shares. It would be highly highly recommended that you use a proper Business banking account. In fact I'm not sure if you're accountant would even let you use a saving account let alone the IRD. Your legal and reporting thresholds are going to be a lot higher in a LLC. Have a read here: www.legislation.govt.nz |
beeswax34 (63) | ||
| 755271 | 2009-03-10 10:43:00 | You can't just take drawings from a company either, gotta pay myself wages or dividends . That stuff is all no problem . Why can't you just take drawings? As wainuitech, I was also told to just take drawings whenever I need money rather than pay myself a wage/salary . |
CYaBro (73) | ||
| 755272 | 2009-03-10 14:44:00 | I'm not sure if you're accountant I'm not sure if he is accountant either. |
roddy_boy (4115) | ||
| 755273 | 2009-03-10 18:06:00 | Not sure if they still do it as I had this service about 15 years ago, but I was told when I started my business to call the IRD and they sent over a bloke who spent about half a day with me going through everything plus gave me a few booklets etc and went through everything with me. It was not intimidating at all and so helpful indeed. About a couple of months later he came back to check if I had any more questions and we went through a few things to clarify GST stuff. This was offered as a free service by IRD to new businesses and IMHO it was a fantastic start for me. I did also talk to an accountant but I got more out of the IRD bloke's help I think. |
Bantu (52) | ||
| 755274 | 2009-03-10 18:36:00 | Talk to Small Business Accountants out in Kilbirne - I know of two separate people who have formed companies in the last 12 months who have used them, and have been very happy with their service and advice. Their charges are apparently quite reasonable too. | somebody (208) | ||
| 1 2 3 | |||||