Family Business Distribution Rules Explained
Rules explained:
If you’re distributing to a family member, the money should directly go to them, and they should be the one utilising that money for their economic benefit.
If you’re a family business and you distribute funds to your spouse, that’s generally acceptable. For example, if you transfer the money to a joint account and spend all the income together, it’s considered permissible.
If you’re a parent and your children are living with you and you provide financial support by giving them money directly, you can distribute that money through your business instead.
If the idea of the whole distribution was just to reduce your tax, then that’s going to be a no. You have to be very careful about what the reason is, and what sort of arrangement you have with your children as well.
If you’re keen to explore changing accountants, we have a non-obligation process to do that. The first step is booking a strategy call with one of our accounting team. It’s a free 20-minute zoom or phone call where you get to meet us to manage your questions.
From that point, you can consider doing a “Look Under The Hood” with us. There is no obligation to change accountants, but we give you a second opinion if you’re paying too much tax.
Throughout that process, we can identify any problems we see with your current setup. Anything that your current accountant hasn’t claimed, or tax you may have overpaid, and strategies of how we might fix that going forward. We can run through with you once you book with us.
Get Cashed Up
