Commencement of a new business or purchase of a business enterprise 043-03080010

The following forms are required depending on whether the customer will operate the business as a sole trader, in a partnership, as a trust or as a company:

• Sole traders or partnerships require a completed Mod (F) - Business details
• Private companies require a completed Mod (PC) - Private Company
• Private trusts require a completed Mod (PT) - Private Trust

An estimate of the anticipated business income and assets should be obtained from the customer in all cases. For a business conducted as a partnership it is the customer's share of the profit, as specified in the partnership agreement, that is maintained as assessable income. A determination on how the business was funded and set up will be required.

The estimate may take the form of:

• documents provided by the previous owner in support of the sale which indicate the past performance of the business
• documents predicting future performance
• a projected profit and loss statement which incorporates the current financial position of the business
• an analysis of income and expenses for a successful tender for a contract
• an interim profit and loss statement, prepared by the customer or their accountant
• an interim balance sheet, prepared by the customer or their accountant

The assessable income maintained following purchase of an ongoing business enterprise must be reviewed as soon as possible after the end of the financial year.

Under the trusts and companies legislation, the income of a company or trust will become assessable, as with sole traders and partnerships. Centrelink will need to obtain an estimate of the income of the company or trust in which our customer is an attributable stakeholder.

The principle of striking the current rate of income applies and the determination of these cases must be referred to the Complex Assessment Officer (CAO). The CAO will determine the attribution of income and assets to the customer from a controlled private trust or company.