Tax and Book Keeping - Being A Sub Contractor

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  Jimothy Wongingtons on 13/06/2023 - 11:58

  +7

  Not to be a smart arse but seriously consider an accountant that specialises in your trade.

  It can be a bit daunting trying to do all the paperwork yourself as you'll need to read about BAS/PAYG etc but it's pretty much the same paperwork every year so maybe if you even pay for the accountant's services year 1, you could probably do the rest yourself going forward after that.

• 

  Jetz007 on 13/06/2023 - 12:11

  Yeah i was told my sister did the same for her small business. As for me early mornings and labor work will be enough for the day to come home and worry about keeping on top.

  would you know the method your paid as a subcontractor?

  • 

    Jimothy Wongingtons on 13/06/2023 - 12:20

    sorry should clarify not a subbie, i have 3 small businesses on top of my normal day job but more or less the same principles would apply

  • 

    jv on 13/06/2023 - 12:41

    +1

    Here is an example of one of Jimmy's small businesses.

  • 

    MrHyde on 13/06/2023 - 15:40

    You send an invoice to the person hiring you with payment amount, terms, GST, etc and if things go well, they pay you when the invoice becomes due.

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  jv on 13/06/2023 - 12:35

  +1

  Being A Sub Contractor

  Collins class?

  • 

    pharkurnell on 13/06/2023 - 16:31

    depends where they are made…

  • 

    ihbh on 13/06/2023 - 21:47

    Thank goodness we haven't had the Jackson V for a while! :)

• 

  SBOB on 13/06/2023 - 13:08

  but getting opportunity as a contractor for painting new built homes

  would seem unlikely without at least the basic trade background education (e.g. Certificate III in Painting and Decorating)

• 

  dtc on 13/06/2023 - 16:19

  +1

  If you are a sole trader then

  • all payments are just normal income like a salary ie there are no corporate or trust or other issues. Hence you need to keep track of all income (essentially revenue = income)

  • all expenses incurred to run your business can be deducted. This is the tricky part, as its materials, perhaps vehicle, bank costs, probably you have equipment deductions, mobile phone, insurance etc. However as a sole trader you will probably use a lot of this stuff for personal activity as well (your work phone might also be your personal phone, you will only have one car not a business and a personal vehicle). So you not only need to know what expenses you incur and whether they are claimable, but also what proportion are claimable. For many you need a log book, others its a reasonable estimate.

  Whatever the difference between revenue and expenses = taxable income, as per a wage. You submit a tax return at the usual time.

  Run a spreadsheet that you keep updated, scan in receipts and so forth. Or you can use a small business accounting package like Intuit QuickBooks or FreshBooks, which have other benefits (like invoicing, allows you to keep track of whether you have received payment etc) and helps with GST (these are a few $100 per year so up to you whether you think you will need it, but they make life easier)

  Suggest you open a specific bank account for your business, so you dont mix up personal and business income and expenses (you can take money out of this to spend as you need it for your personal requirements; but its just easier to have things going into and out of one account)

  Remember to set aside money to pay tax, as you wont be taxed as you earn

  Remember that next FY you will be hit with PAYG instalments

  Remember your GST requirements

• 

  JimmyF on 13/06/2023 - 17:44

  -1

  I wanted to know as this is my first time attempting at self employment, ( i have a DIY home renovation and painting experience) which i want to make a profession. Not many companies hire me for working under a company, but getting opportunity as a contractor for painting new built homes, this would be my best bet to get a foot in the door.
  how does the money come in and how do i pay taxes on my income.

  This statement is so confusing. If you already have a company then you should have a ABN and you should already known how to pay taxes etc.

  Being a sub contractor isn't really any different. You invoice the company you did the work for instead of the 'client'.

  You pay taxes like normal, don't forget GST too and insurances.

• 

  AndyC1 on 14/06/2023 - 19:07

  Call your accountant and ask them.

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  Tily on 14/06/2023 - 20:08

  Check what the requirements are to be a Contractor with these Companies that you want to work for as some places don’t want to deal with sole traders, only PTY LTD. Also check what insurance requirements - work cover, public liability, motor vehicle, etc. and any training/accreditations which these Companies may need you to have.

  Payment wise, you may need to cash flow yourself in the first month or so, depending on the agreed payment terms you have with these Companies. A lot of these Companies have a fixed payment term, which you would not be able to negotiate on.

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  charlesswab48 on 27/06/2023 - 17:28

  Having a constructions company Lismore is really a hard business. There are so many factors to consider for this business to be succesful.