“If you want your own business, this is the best value 21st century support service in Australia”
We offer you full office support so that a one person business can look like a medium sized corporate, and through our community of professional members, we also provide professional back up and a pool of resources and staff when needed for those bigger contracts.
With our services you:
- Are able to upsize or downsize in minutes
- Have no cost hangovers if you cease business
- Have no fixed costs like rent.
How it works
- You have a free consultation
- You agree the services you wish us to provide and the structure you wish to use
- We implement those services
- You send timesheets to the client (or agency) for approval as well as freespirit
- We invoice the client who pays us
- We then make all your payments in accordance with your remuneration package to minimise the tax you pay, & increase the money you have to spend.
Your Choice
| Employed by freespirit | Benefits |  |
Subcontracting to freespirit | Benefits | |
Your own ABN business | Benefits | |
Benefits of being Employed or a Subcontractor to freespirit
Freespirit have established businesses that advance the interests of its members and complies with government legislation in order to remove the hassle and need for those members to pay for the expense of their own entity, as well as providing added member benefits. Further in your own entity to be able to claim any home office, telephone, postage, travel, air, car hire, parking, road tolls, equipment, self-education, books, stationery and other normal business expenses all personal exertion income needs to be earned through a Personal Services Business. To be classified as a Personal Services Business, certain tests need to be passed. Please refer to FAQ.
The Advantages of freespirit Contracting compared to your own entity include:
- Our costs are usually covered by the savings you make
- No Start Up Expenses for what may be only temporary work: Incorporation costs, where employed - ABN Registration, Fringe Benefits Tax Registration, GST Registration, Payroll Tax Registration, Tax File Number Registration, Withholding Tax Registration.
- No liability or risk as either a director or a partner, no bad debts and all taxes and deductions remitted to the proper authorities.
- Taxation and accounting advice and references for banks and real estate rentals taken care of.
- Minimal paperwork
- Established Superannuation Fund that includes: deductible life and income protection insurance, multiple investment options and without the need for a medical.
- Insurances are covered for Workers Compensation, Public Liability and Professional Indemnity.
- Income paid on a set day where employed, rather than having to wait and hope that your clients pay you.
- No Statutory Record keeping or Lodgments for: ABS Returns, ASIC returns, minute books, BAS, Dividend advices, Fringe Benefits Tax Returns, GST, Income tax returns, Payroll Tax Returns or Withholding Tax Returns either monthly, quarterly or yearly
- No additional costs for: ASIC annual and lodgment fees, industrial relations audit, payroll tax audit, income tax audit, workers compensation audit, accountancy fees, payroll tax premiums, workers compensation premiums, penalty tax for late lodgment of BAS or Payroll tax returns.
- Unemployment benefits may be payable between contracts
- No administration time and hence cost for: Contract Establishment, Invoicing, Debt Collection, Banking and Distribution of funds to PAYG tax, superannuation, net pay into domestic or foreign accounts, reimbursements and car expenses or administrating cash flow.
- Increased income from: discounted home loans, Car and equipment leases. Training assistance through skills assessments and discounted training & education and where employed - Salary Packaging, LAFHA Interstate and domestic, FBT allowances, tax deductible reimbursement of expenses
- No Costs when not working
- Jobs assistance through CV improvement and Skilled Spirits referral network
- Visa assistance for sponsorship, migration and work visas
- Full range of Member Services available
Benefits of Your Own ABN business supported by freespirit
- Support Services
- Standard Service
Starting a Business - As part of our standard service you have access for free via our contractor infonet to our 24 step process for starting your own successful business as well as assist you with your particular circumstances.
Standard Support Service
- Additionally you will receive
- Free Initial Consultation
- Client Contract Establishment
- Invoicing
- Debt Collection
- Disbursement of funds
- Arrange workers compensation & insurances at discounted rates
- Client Contracts provided to suit your circumstances
- Client Services advice line during business hours
- Member Services
Other Services available:
BAS & Bookkeeping Service: Recommended for everyone *- Bas & bookkeeping taken care of
- General ledgers prepared
- ASIC returns and company secretarial filing
- Payrolls prepared
- Financial Statements of income and expenditure.
- Management Reports
- All income and other tax refunds and returns
- Taxation Planning
- Chartered Accountant for accounting & taxation advice
- Creditor’s ledger prepared
- Aged creditors ledger
- Payments prepared on a weekly/fortnightly/monthly basis
- Mail automation and a paperless office
- Business intranet
- Document Management System so that accurate records can be kept to ensure legitimate expenses can be claimed as a tax deduction.
- Your own phone number answered in your own name
- Business hours, 8 to 8 and 24/7 phone support available
- Appointments taken on your behalf
- Text reminders & google maps sent to your clients
- Your own Personal assistant for all typing and general needs
- Internet Research
- Lifestyle Assistant
- Guidance on your salary packages, superannuation, investments and your insurances in order to maximize your disposable income and assets.
- Business Coaching
- Human Resources and employee contracts
- Legal support
- Research Professionals for all your original research & document writing needs
- Websites built
What does it Cost?
Management fee of 3% only for our Standard Service.
As part of that our Start up service, step by step process is free, but where you need further assistance charges may apply.
- 3% for BAS Bookkeeping
- 2% for Company & Business Income Tax Refunds & Returns
- 2% for Financial Management
- 3% for Virtual Office Services
- Costs for Salary Packaging, Financial Planning and Other Services vary depending on your needs from time to time. Note all fees are quoted as a percentage of your gross income.
What Does it Save me?
The management Fees are up to 50% cheaper than sourcing it yourself. That together with the substantial tax savings and increase in your disposable income from our unbeatable salary packages, means that you will be giving your business the best chance of success. Example of Savings
How can you provide a whole office and staffing so cheaply?
We have great systems & people, & over 30 years of experience.
Example of Savings
I’ve decided to start my own fully fledged business and I’ve budgeted to earn 500k for the first 12 months. I’m hiring a graduate and a secretary/pa/bookkeeper to maintain our serviced office.
What are the advantages of your service?
In this case you decide to look at all the additional services excluding Financial.
$ 000 |
$000 |
|
| Fees | 500 |
|
| General Business Cost | 40 |
|
| Professional salary incl. super | 88 |
|
_____ |
_____ |
|
| Net | 372 |
372 |
| freespirit business services | 0 |
55 |
| Accountancy | 5 |
0 |
| Rent of serviced office | 24 |
0 |
| Secretary bookkeeper | 55 |
0 |
| Other costs related to secretary bookkeeper |
||
| e.g. training, recruitment, all leave, workers comp, |
||
| equipment, furniture etc etc | 25 |
0 |
_____ |
_____ |
|
| Net Profit | 263 |
317 |
| Savings | 54 |
This does not include the savings to be made from effective salary packaging
Q. Do I need to set up my own business?
A. No, you can use one of our own companies which you will find is cheaper than running your own entity. However we are fully supportive in helping you run your own business as well.
Q. When will I be paid?
A. Where you are employed by one of our companies you will be paid on a set day depending on the cycle agreed with the client or agency. However where you have your own ABN business then you will have to wait until the funds are received from the client.
Q. What is the criteria to make your recommended consultants list?
A. The consultant needs to provide value i.e. quality work at a reasonable price. That generally means not expensive but sufficient to reward an experienced professional. They are either recommended by our clients or staff based on their experience. We look to maintain where possible at least 3 options in each category ranked in order. We will supply you the top ranking at any, however other choices are available on enquiry. By all means please use your own consultant and we appreciate all feedback, positive or negative in order to keep our list current.
Q. What is Personal Services Income?
A. Personal Services Income “PSI” is income that is earned as reward for your personal skills and efforts. Examples include: salary and wages, contractor’s labour, consultant’s income, but does not include income generated from asset sales, goods or property.
A Personal Services Entity “PSE” is a company, partnership or trust whose income includes PSI of an individual.
Where you have PSI, the PSI Rules:
Requires the inclusion of an amount of income of an interposed Personal Services Entity which is PSI of an individual, in the individuals assessable income
restricts deductions that may be claimed by an individual, or an interposed Personal Services Entity to match those that an employee would ordinarily be allowed to claim
requires additional PAYG withholding requirements onto interposed Personal Services Entities.
The PSI Rules do not apply where:
-
The income is not PSI;
-
The income is promptly paid out to the individual as salary and wages
-
The individual is an employee or office holder; or
-
The income is derived through a Personal Service Business.
Q. What is a Personal Services Business?
A. A Personal Services Business “PSB” is conducted if:
A PSE or individual has a Tax Determination stating they are carrying on a PSB; or
Results Test – Is satisfied if 75% of the PSI relates to income that is producing a result and the individual must supply plant and equipment or tools of trade to perform the work and the individual is liable to rectify any defects in the work performed; or
The PSE or individual does not have 80% or more of their income from a single source, plus you satisfy one of the following tests:
Unrelated Clients Test – Is satisfied where the individual provides services to 2 or more entities that are not associates of each other or of the individual and services provided are the direct result of the individual/PSE making offers to the public at large.Employment Test – Is satisfied if the individual or PSE engages one or more entities to perform at least 20% of the individual’s work for the year(the entity must not be an associate).
Business Premises – Is satisfied if the individual/PSE uses premises in which it mainly conducts the activities from which the PSI is earned, has exclusive use of the premises and the premises are physically separated from those used for private purposes.
Q. What is the GST Enterprise Test?
A. To be registered for GST you must be carrying on a "Enterprise". If your activities fall outside the concept of an "enterprise" you cannot be registered for GST.
Individuals at risk of not being able to register for GST or obtain an ABN include "contractors" or “consultants" who are, in fact or at common law, "employees” of the recipients of their services.
Q. What is the effect on my own company or partnership?
A. Tax is not deducted at source when a client pays a company’s or partnership’s invoices provided they have an ABN number included on their invoice.
However if you do not pass the Personal Exertion Test and work for say one organisation less 80% of the time, then the ATO may rule that you are an employee and require that the company pay them the tax owing on the total amount billed.
Q. What is Salary Packaging?
A. Salary Packaging is also known as Remuneration Packaging and is the skill in putting together the components of an employee or contractors income in order to reduce their taxes while increasing their disposable income.
Q. How is a Salary Packaged?
A. You elect to have tax advantaged benefits paid by your employer in lieu of gross salary so s to reduce the tax levied on your income.
Q. What components can I include in my package?
There are hundreds of combinations depending on your circumstances. One of our helpful consultants will construct a package that will maximize the benefits available to you.
Q. Are your fees tax deductible?
A. Yes
Q. Is it important to structure your contract in order to pass the results test?
A. A tax ruling by the Administrative Appeals Tribunal Taneja and Commissioner of Taxation [2009] AATA 87 (11 February 2009) has affirmed that it is very important to prepare your client contract properly if you are to pass the "results" test.
The "results" test essentially determines whether a contractor is eligible to pay tax as an individual or a company, and looks at three key factors of whether the contracting entity:
- is paid for achieving a result;
- is required to supply plant and equipment to do the work;
- is liable for the cost of rectifying any defect in the work performed.
However, the AAT said each of the three elements of the results test operate independently.
It found there was no evidence in the contracts to suggest that the contractor's company was being paid “for producing a result”.
"On the contrary, that the company was being paid for the time that it spent, through the taxpayer, doing what the client asked of it," the AAT said.
The contractor argued that the contracts were structured on an hourly rate charge rather than a cost-for-results basis because it was "custom and practice" in the IT sector.
The Tribunal accepted that it was "possible for a person who is contracted to produce a result to choose to charge hourly rates as the means of remuneration, without altering the fact that payment is made for producing a result".
However, it said while the method of payment was a factor in assessing the results test, the key question to be asked was whether the company received its income for achieving a result.
The AAT ruling barred the contractor's claims for a range of tax deductions, including payments to his wife for administrative services.
Member Services
Additional services are available through us and our business partners at discounted costs that provide real value for our members.Banking Facilities
We provide guidance and introductions to our bank for contractors new to the country or Australians looking for a better solution to fast- track establishing their accounts.
Financial Planning
Our Planning maximises your savings and investments and/or cost effectively covers your risks via effective insurance programs.
Fleet Discounts
We have arranged vehicle fleet discounts through our supplier of novated leases for the purchase of your car.
Insurance
Workers compensation and public liability are compulsory and those together with professional indemnity will be organized for you. If you join a freespirit company these costs are covered. We can also organise income protection and life insurance so as to be tax deductible.
Leasing of Computers & Equipment
We can arrange all your leasing and rental needs.
Medical Insurance
Some non-residents are eligible for Medicare cover for emergency and essential items under the public health system where Australia has a reciprocal arrangement with your country,
Contact Medicare on tel: 132 011 or www.hic.gov.au.
Alternatively, private medical insurance is available.
Migration & Visas
We can organize migration and visas whether it be for permanent residency or a working visa.
Mortgages & Loans
We cater for all your Mortgage and loan requirements.
Novated Vehicle Leases
As part of salary packaging, we are able to offer novated leases that meet tax office requirements. This enables contractors, to salary package a vehicle of their choice, as well as pay the vehicle expenses with pre-tax dollars.
A novated lease is an agreement between the finance company, the employer and the employee, where the employee is ultimately responsible for the vehicle. A fleet card is also available to pay for the car expenses and to provide monthly reporting and administration.
Reference Letters
We will assist you with letters of introduction and confirmation of earnings to assist with finance and rental accommodation applications.
Referral to Positions & Jobs
We are able to provide referral to our network of agencies to locate suitable work.
Sponsorship
We can often organise sponsorship to overseas contractors with "specialist skills" as well as migration services.
Superannuation
We have established Superannuation plan with one of Australia’s leading fund managers set up with multiple investment choices. You have the choice to use components of your superannuation contribution to provide you with life and income protection as well to give you an effective tax deduction for these costs.
Our fund allows you to have any of the following components;
- Life Cover up to $400,000
- Total and Permanent Disability up to $400,000
- Income Protection Insurance up to 75% of income for 2 years; and
- A multiple investment account.
Another benefit is that you do not need to do a medical to be approved for the insurances.
Employees may also make additional contributions to their superannuation fund. They are an allowable deduction up to the annual maximum amount of $25,000 ($50000 in some circumstances).
Training
Please contact us to arrange a booking and so that you can benefit from the discounts available and to reduce your taxable income.
Travel
We have arranged a wide variety of travel services including: domestic and international air tickets, accommodation, coach passes, car hire, escorted tours, adventure packages, cruises, ski holidays and travel insurance.
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