Accounting for Trades People
Over past two decades we have assisted several hundred builders, plumbers, carpenters and electricians with their accounting, tax and financial affairs. In fact, the building trades have become a niche area within our accounting firm.
Click Here to Download PDF
We appreciate the fact that the long hours and physical demands associated with the trades often mean bookkeeping and administration don't get the attention they deserve. While GST, BAS and tax payments often represent some of the largest financial obligations for a business, many trades people struggle to manage their tax affairs.
Here at Nexus Accountants we have mentored a large number of trades people through the start-up phase of their business. We understand the pitfalls and can help you with everything you need including your business structure, insurances, branding, software selection and marketing. When its time to employ apprentices and sub-contractors we can help you comply with the regulations. This is obviously in addition to the usual small business compliance issues of GST, BAS, PAYG and Superannuation.
We are not your average accounting firm that just keeps the 'score'. Our mission is to help you grow your business and with over 20 years experience with clients in the trades you can benefit from our experience. We have produced a number of specific e-booklets for the trades that you can download including:
- 11 Things Every Trades Person Should Know (pdf)
- Accounting For Trades People (pdf)
- Industry Benchmarks for Trades (pdf)
- The Motor Vehicle Tax Guide (pdf)
The various trades we service extend beyond plumbers, carpenters and electricians. In fact, we have clients that span more than 40 different trades including:
Starting a Trades Business?
Trades people are one of our specialist client groups and we can help you build a more profitable, valuable and saleable business by combining the knowledge of your industry with our consulting tools and marketing expertise.
We are recognised as business start-up specialists and if you are looking to start a business in the trades or buy an existing operation, there are numerous issues to consider. There is your business structure, tax registrations, insurances, tools, software, your vehicle plus finance. As business advisors we can assist you in all of these areas plus provide advice on HR matters, payroll and the preparation of a business plan.
Over the past two decades our team of accountants have helped dozens of trades people get their business off to a flying start. We offer you experience, technical tax knowledge and most importantly, an intimate understanding of the building trades.
Starting a business is a bit like building a house and it all starts with solid foundations. In a business sense these include the right tax structure, accounting software, insurances, a marketing plan, website and social media channels. Your choice of business structure is critical and there are a number of different options including sole trader, company, partnership or trust.
When it comes to selecting the most appropriate tax structure for your business we always recommend you ‘start with the end in mind’. There are a number of different options including sole trader, partnership, company and trust but Australian tax laws are complex and changing your business structure at some point in the future can trigger a capital gains tax event that could prove costly. Whenever we provide advice on business structures we always take into account issues like:
- Minimisation of Income Tax
- Maximize Asset Protection
- Allow for the admission of New Business Partners or Investors
- Comply with all Legal Requirements in your Industry
- Consider Future entitlement to Discount Capital Gains Tax Concessions
- Risk Profile of Your Industry (and trades are high
As a consequence, we often find the business structure is a compromise based on the relative importance of each of these issues. In some cases you might also need to consider if it will be easier to do business in your industry as a company or sole trader.
Your choice of accounting software is another brick in your business foundations and up to date, accurate financial records let you make informed business decisions. The wrong software can be catastrophic and poor financial records are one of the biggest causes of business failure for trades people. Your software needs to match your business needs with your level of accounting skill otherwise you could end up producing what we describe as 'computerised shoebox' records. This can cause frustration One of our priorities is to help you cut the cost of compliance which in some cases includes training you to use the software. While we support a number of programs we have a strong preference for cloud based solutions like Xero.
To build a house you also need the right tools and when 'constructing' your business we have developed a number of tools including a start-up expense checklist broken down into various categories including:
- tools and equipment
- professional advice and software
- information technology costs
- marketing and signage
- vehicle and trailer costs
This checklist will help you identify all your potential establishment costs and these figures then filter through to our cash flow budget template and allow us to produce a projected profit and loss statement for your first year of trading. These reports can also tuck neatly into our business plan template that will help you secure funding from external sources like a bank.
If you need a vehicle in your business we can assist you with finance by chattel mortgage or lease through one of our affiliate partners and you can also access fleet pricing on your new car, ute or light commercial van that could save you thousands of dollars. For a tradesman, your vehicle is arguably your most important business tool and you can learn more about the alternative methods of claiming your car expenses and the distinction between a business and private trip by downloading our 'Motor Vehicle Tax Guide' from the resources section of our website.
Through an affiliate partner we can also help you source funds to finance your business purchase, equipment or franchise fee (if applicable). Pricing is absolutely vital to the success of your business and we can help you do some price modelling plus we use benchmarks to compare your business performance against your peers so you know what is working in your business and what needs working on. If you're starting a business you don't need to reivent the wheel as we have all the tools and resources to help you get off to a flying start.
MARKETING YOUR TRADES BUSINESS
For small business owners, your marketing can be the difference between gloom, doom and boom.
Most trades people rely on their reputation and referrals to grow their business and while these ingredients remain important, you need to shift your marketing focus online. Increasingly local searches like ‘Builder Malvern’ are driving traffic to your website and often your website is the first touch point with a potential new customer. As you know, you only get one chance to make a good first impression and your website is your silent sales person working 24/7 to promote your business.
One of our biggest points of difference compared to other accounting firms is our marketing expertise. We can assist you with your branding (business name, logo and slogan), your corporate brochure and help you harness the power of social media to win more referrals. Over the past few years we have worked with dozens of tradie clients to help them create affordable, quality lead generation websites that are responsive to smart phones and tablets. We can provide advice and guidance with your website content including video production and if your website lacks calls to action or lead magnets we'll help you build them. In addition, we'll introduce you to strategies like re-marketing and search engine optimization to drive more traffic to your website.
If you aren’t using some of these marketing techniques your business probably won't reach its full profit potential.
The marketing process begins with your branding and we have worked through the process with dozens of clients over the years and using some online resources we can help you build a modern brand that resonates with your target market. We can even help you develop your stationery at a fraction of the cost of engaging a graphic artist or marketing consultant.
We recognise the fact that business owners want more sales, more customers and more profit so we also give you access to one of the world’s most successful marketing programs, the ‘Business Growth System’. It contains more than 80 breakthrough marketing strategies supported by videos, templates, checklists and 2,500 pages of instructions. Access to this ‘vault’ of resources would normally cost you $500 per month ($6,000 per annum), however, as a client of Nexus Accountants you get unlimited FREE access. In addition, you also get unlimited access to the ‘Grow Your Business in 5 Days’ video training course that could have a massive impact on your future business growth.
Our role includes helping you understand the Four Ways to Grow A Business and in the process, identify the key profit drivers in your business. We can talk you through various profit improvement strategies and even quantify the profit improvement potential in your business. Our role is to make sure you don't leave any profit on the table.
The team of building trades specialists at Nexus Accountants offer you a range of accounting, taxation and business coaching services including:
- Business Start Up Advice for Plumbers, Builders, Carpenters, Electricians and Tradies
- Advice regarding the Purchase or Sale of a Building Trades Business
- Tools like the Start-Up Expense Checklist and Templates for a Business Plan and Cash Flow Budget
- Advice and Assistance with the Establishment of Your Business Structure
- Tax Registrations including ABN, TFN, GST, WorkCover etc.
- Preparation of Business Plans, Cash Flow Forecasts and Profit Projections
- Accounting Software Selection and Training – Bookkeeping, Invoicing, Quotes & Payroll
- Preparation and Analysis of Financial Statements
- Preparation of Finance Applications
- Bookkeeping and Payroll Services
- Income Tax Returns and Tax Planning Strategies
- Wealth Creation Strategies and Financial Planning Services
- Industry Benchmarking and KPI Management
- Vehicle & Equipment Finance (Chattel Mortgage & Lease)
- Monitoring and Controlling Labour and Sub-Contractor Costs
- Advice & Assistance with Pricing and Claiming Vehicle Costs
- Recession Survival Strategies
- Advice regarding Employee Relations and Workplace Laws
- Business & Risk Insurances (Income Protection, Life Insurance etc.)
- Business Succession Planning
We are more than just tax Accountants. We are business and profit builders who genuinely care about the success of your trades business. We service the accounting needs of a number of tradesmen from all around Australia and offer you strategies to grow your business, your profits and your wealth. Over the past decade trades people have become a niche area within our accounting practice and if you’re looking to get your business off to a flying start or want to grow your existing business, contact us today on (03) 9500 8666.
If you're a committed and ambitious business owner looking to accelerate your business success we invite you to book a FREE, one hour introductory consultation to discuss your business needs. You can expect practical business, tax, marketing and financial advice designed to help you build your business and grow your wealth. To book a time, contact us today or complete your details in the box at the top of this page