[ESTABLISHING A BUSINESS ENTITY IN AUSTRALIA]
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FBT rate for the year ending March 2024 is set at 47%. Charge (SGC) - If an employer fails to pay the statutory minimum level of Superannuation Guarantee superannuation to their employee’s nominated superannuation fund, the employer will be liable to pay the Superannuation Guarantee Charge. The SGC is an amount equal to the value of the relevant shortfall in statutory superannuation payments, plus interest (currently at a rate of 10%) and administrative charges. State and Territory specific taxes - In additional to the federal taxes outlined above, each Australian State and Territory has their own taxation framework which may create additional tax liabilities for entities that conduct business in Australia. Examples of such state-based taxes include: Payroll Tax : Each State and Territory has a Payroll Tax system under which an employer is liable to pay tax on the value of the employer’s monthly payroll expenses (including any relevant fringe benefits). Payroll Tax rates are generally between 4- 7% but may differ significantly between each State and Territory. Each State and Territory also has a monthly wage threshold test to determine whether an employer is required to pay Payroll Tax. Stamp Duty : Individuals or entities that acquire land, certain interests in real property or interests in other entities that have significant land holdings may be required to pay an additional state-based tax known as Stamp Duty. Acquisitions to which
Stamp Duty may apply, and the relevant rate of such Stamp Duty, varies significantly from State to State. Acquisitions of real property by foreign investors will often attract a higher rate of stamp duty. Land Tax : Individuals or entities that are the registered proprietor of Australian real property will also incur an annual Land Tax liability. Similar to Stamp Duty, the types of real property that will attract a Land Tax liability, and the relevant rate of such Land Tax, varies significantly between the States and Territories.
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Capital Raising Regulation The Corporations Act provides a framework for regulating fundraising activities (including capital raising) within Australia. The relevant provisions of the Corporations Act impose rules regarding offers or invitations to subscribe for new ‘financial products’, including shares, units in a trust, partnership interests and debentures in respect of both private and publicly listed entities. The underlying principal of the fundraising rules under the Corporations Act is that, unless a specific exemption applies, a person must not make an offer in respect of a new financial product before providing potential investors with a disclosure document. Depending on the circumstances of the offer and the characteristics of the target entity, the offering party may also be required to lodge a copy of the relevant disclosure documents with ASIC, prior to extending the offer to potential investors. Generally speaking, a disclosure document must be in the form of a prospectus, which, depending on the nature of the financial product, can be either a long-form or short- form document. There are specific exemptions
ILN Corporate Group – Establishing a Business Entity Series
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