# Fees from accountant (ASIC annual fee)



## bonkerrs (4 March 2011)

I have a company setup for trading shares.

Recently, I received an ASIC Annual fee (218.00) from my accountant. That's not a problem but I wanted to see if it is normal for the accountants to charge 275.00 to send me the invoice from ASIC. I'm sure their work would be very minimal - receive the ASIC invoice, check it over then forward it to me.

Am I being charged properly? Hoping to hear back from seasoned traders with similar setup.

Thanks
Ben


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## bellenuit (4 March 2011)

bonkerrs said:


> I have a company setup for trading shares.
> 
> Recently, I received an ASIC Annual fee (218.00) from my accountant. That's not a problem but I wanted to see if it is normal for the accountants to charge 275.00 to send me the invoice from ASIC. I'm sure their work would be very minimal - receive the ASIC invoice, check it over then forward it to me.
> 
> ...




I have a share trading company too and the accountant just passes the ASIC Fee (mine is $212) on to me.  He makes no charge for doing it.

Perhaps my accountant builds some fudge for those type of costs into his fees for doing the Accounts and Tax Return after year end, but it couldn't be much as that fee only comes to $750 and does require a fair bit of work. However, I do all the hack work like categorising and totalling expenses.


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## skc (4 March 2011)

bonkerrs said:


> I have a company setup for trading shares.
> 
> Recently, I received an ASIC Annual fee (218.00) from my accountant. That's not a problem but I wanted to see if it is normal for the accountants to charge 275.00 to send me the invoice from ASIC. I'm sure their work would be very minimal - receive the ASIC invoice, check it over then forward it to me.
> 
> ...




My account sneaks in an invoice around this time as well - but for only $200 + GST.

The invoice from what I understand is to cover all company registry administration, e.g. lodge various details, and for attending to various matters as they arise. You can probably do most of the activities yourself if you really don't want to pay them...


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## bonkerrs (4 March 2011)

bellenuit said:


> I have a share trading company too and the accountant just passes the ASIC Fee (mine is $212) on to me.  He makes no charge for doing it.
> 
> Perhaps my accountant builds some fudge for those type of costs into his fees for doing the Accounts and Tax Return after year end, but it couldn't be much as that fee only comes to $750 and does require a fair bit of work. However, I do all the hack work like categorising and totalling expenses.




Hi bellenuit. Is your accountant in Perth? Do you recommend him/her?

skc... just noticed your 'location'. I'm jealous!! I want one too.


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## Tysonboss1 (4 March 2011)

My accountant just passes the invoice for $218.00 on to me and I make the payment directly to ASIC via cheque.


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## awg (4 March 2011)

I registered on the ASIC site, you are issued a "key" number.

They send out an invoice email.

I pay online

that is for my trustee company for smsf

juz remember to update you email contacts if you change provider ( or use a hotmail account)

give them a ring if not sure, they were helpful on phone


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## bellenuit (4 March 2011)

bonkerrs said:


> Hi bellenuit. Is your accountant in Perth? Do you recommend him/her?




He is in Perth. He is just OK. He takes a bit long to respond to my questions, but he is cheap. I have studied accounting, but never worked in the profession. I only use him to do the accounts and tax, as I haven't kept up to date on those requirements. I can PM you his name and address if you like.


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## Julia (4 March 2011)

bellenuit said:


> I have a share trading company too and the accountant just passes the ASIC Fee (mine is $212) on to me.  He makes no charge for doing it.
> 
> Perhaps my accountant builds some fudge for those type of costs into his fees for doing the Accounts and Tax Return after year end, but it couldn't be much as that fee only comes to $750 and does require a fair bit of work. However, I do all the hack work like categorising and totalling expenses.



Wow, bellenuit, $750 is cheap!  You will presumably have the audit fee on top of that?
How much do you pay for the audit?
 Approx how many transactions are included in that tax return fee?
(Of course, ignore the question if it's intrusive.)


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## trainspotter (4 March 2011)

bonkerrs said:


> I have a company setup for trading shares.
> 
> Recently, I received an ASIC Annual fee (218.00) from my accountant. That's not a problem but I wanted to see if it is normal for the accountants to charge 275.00 to send me the invoice from ASIC. I'm sure their work would be very minimal - receive the ASIC invoice, check it over then forward it to me.
> 
> ...




*HOLY MOLY !!!!!! *

Get another accountant Ben. Insane expense to post an invoice that you can pay online direct to ASIC. Contact ASIC and ask them to change the billing address direct to you and not to your accountant.

CRUMBS !!!!!!


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## bellenuit (4 March 2011)

Julia said:


> Wow, bellenuit, $750 is cheap!  You will presumably have the audit fee on top of that?
> How much do you pay for the audit?
> Approx how many transactions are included in that tax return fee?
> (Of course, ignore the question if it's intrusive.)




Julia,

$750 is the total fee I paid to him in 2010 and that is a $100 increase over 2009. I don't have any audit fees. I am sure auditing is not applicable to non-listed proprietary companies with just a sole shareholder. I have read all the ASIC material and am not aware of that requirement.

The number of transactions are irrelevant as I do all the hack work and just provided the total summarised information to him so that he can prepare the accounts (Balance Sheet, P&L etc.) and Tax Return. I could probably prepare them myself, but it would require me to keep up to date in accounting. I just don't have the time (much prefer to drink coffee at the local cafes and read the newspapers) nor the interest to stay up to date and with his rates so low it doesn't make sense to do so.


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## bonkerrs (7 March 2011)

Further to my annoyance with the 275 fee.

I called them today to ask what it is that they do to charge 275. The reply was that if any changes came through during the year they would perform them as part of that fee. Changes like if I wanted to transfer shares from/to the company, change the number of directors... things like that. I was told that some companies are much more complicated and get a lot of activities. Well not mine. I have me only. I see no reason for them to charge me this sum for the off chance I may want them to do something mentioned above. To me that sounds ridiculous. It's like my car insurance charging me the 500 excess annually "in case" I get into an accident and need to claim.


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## pedalofogus (11 March 2011)

bonkerrs

Our firms fee is $150 + GST, and it has been set at that level because that covers:

  - the time costs for the grad to check the ASIC register annually to make sure that ASIC haven't screwed anything up; 
  - the subscription fee we pay to BGL (software provider) to have the Corporate Affairs Software; and
  - It also has a small component to cover any minor changes to the register that the client may require.  

But i would say that if you are paying $275.00, then you are paying too much.  In reality, the work involved in maintaining your own company register is extremely simple, especially if you only have yourself as the director and shareholder, because generally the only forms that you would need to lodge is every 5 years or so when you move house.  So if you are a semi-smart person, i think you would have no problems maintaining the register yourself and getting out of paying the fees to the accountant for it.

That is what i have always told my clients and, as a result, probably about 10 of them have decided to maintain their own register.  The others have just said 'no, we are happy to pay you the $150 so we don't have to worry'.  So it just ends up being a personal choice.


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## bonkerrs (26 March 2012)

pedalofogus said:


> bonkerrs
> 
> Our firms fee is $150 + GST, and it has been set at that level because that covers:
> 
> ...




I can't believe a whole year has gone by since I whinged about this fee... it's come up again. Dam it.

@ pedalofogus. What is your firm called? Where are you located? What kind of work does your firm do?

I am in the market for a new accountant to handle my work. It's not just about the fee I'm being charged, I've found mistakes in their work for me on more then a couple of occasions.


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## tinhat (26 March 2012)

That reminds me I have to change the family company and SMSF trustee company ASIC contact back to dealing with ASIC directly to pay the annual fee. My accountant added about $100 plus GST last year for one of the companies when I first told him he could handle it. Aside from forwarding me the company review invoice from ASIC they had some bit of paper work - a declaration by the directors that the company was still solvent. I guess not a bad idea for them if they are acting as the accountants but not really necessary paperwork. I don't blame the accountant for charging a fee for service - there is drone level paperwork involved for them, but I can handle paying an invoice by myself.


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## gav (26 March 2012)

bonkerrs said:


> I called them today to ask what it is that they do to charge 275. The reply was that if any changes came through during the year they would perform them as part of that fee. Changes like if I wanted to transfer shares from/to the company, change the number of directors... things like that. I was told that some companies are much more complicated and get a lot of activities. Well not mine. I have me only. I see no reason for them to charge me this sum for the off chance I may want them to do something mentioned above.




Then why set up a company to trade under in the first place?  Is there some benefit for you to do this than simply trading without a company?


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## ck13488 (26 March 2012)

tinhat said:


> That reminds me I have to change the family company and SMSF trustee company ASIC contact back to dealing with ASIC directly to pay the annual fee.



if a company is only setup to be a corporate trustee they are classed as a special purpose company and are eligble for a reduced annual fee 
See ASIC website here



gav said:


> Then why set up a company to trade under in the first place?  Is there some benefit for you to do this than simply trading without a company?



cap gains are treated as normal income etc
ATO are very strict on companies setup to trade. see their website


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## tinhat (26 March 2012)

ck13488 said:


> if a company is only setup to be a corporate trustee they are classed as a special purpose company and are eligble for a reduced annual fee
> See ASIC website here




Good point. My previous accountant didn't even set up the company right and I had been paying the full annual fee previously. I picked that up and changed the status of the company with ASIC myself.


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## waimate01 (27 March 2012)

bonkerrs said:


> Am I being charged properly? Hoping to hear back from seasoned traders with similar setup.




I also have a family investment company. My observation is that accountants with whom you have an ongoing relationship (annual return, quarterly BAS, annual filings, occasional questions, occasional ATO correspondence) have a view about how much you're going to end up paying over the course of a year. 

It really doesn't matter how they slice it over how many invoices, or what's written on those invoice -- they have a figure in mind that you're going to pay. It's the total revenue for the relationship they care about, and ultimately that's what you should care about too.

I could understand if an accountant were keen to smooth their revenue over the course of the year, rather than have the bulk of it appear when your tax return is ready. 

Talking to people, it seems common for total annual accounting fees for family+company to be around the $3000 mark, although mileage varies both ways.


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## gav (29 March 2012)

ck13488 said:


> cap gains are treated as normal income etc
> ATO are very strict on companies setup to trade. see their website




I have been trading the last 2yrs as an individual and have just been paying capital gains on my profits.  I had a quick look at the ATO website and I couldnt find anything that stated I need to set up a company to trade?


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## McLovin (29 March 2012)

ck13488 said:


> cap gains are treated as normal income etc




No, capital gains are only treated as ordinary income where the company is trading in shares, as opposed to investing. For assets purchased to generate an income on the assets, as opposed to the trading of the assets, a company is liable for CGT. It's no different to an individual.


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## bellenuit (29 March 2012)

McLovin said:


> No, capital gains are only treated as ordinary income where the company is trading in shares, as opposed to investing. For assets purchased to generate an income on the assets, as opposed to the trading of the assets, a company is liable for CGT. It's no different to an individual.




Just to be specific on trading as opposed to investing....

When you are trading, those shares you hold for trading do not come under the capital gains regime at all. This applies to companies and individuals. Your profit from trading is Sales less Cost of Goods Sold and the latter is calculated as Opening Stock plus Purchases less Closing Stock. You have options as to how you value your share trading stock - by cost price, by market price or by the lesser of the two - and your choice can change from year to year.

I won't go into the detail here, but because of the valuation methods allowed, you can actually make profits (or losses) simply through the change in value of the stock (for instance when valued at market price) without actually buying or selling shares. 

In the CGT regime, you actually have to have a Capital Gains event (such as a sale of shares) before you can have a capital gain or loss.

Shares held for investing come under the capital gains system. One difference between companies and individuals under the CGT system is that companies cannot claim the 50% discount for shares held for over a year.

Because of the different tax treatment between shares for trading and shares for investing, it is important that you can clearly identify which are which in case of an ATO audit. One way to do this is to have two separate broker accounts, one for trading and one for investing. Others might do the investing in their own name and trading in a company name to keep thins separate.


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