Learning to ask WHY
Posted on December 1, 2011
Well here we go again. Today I got a phone call from a gentleman who was asking how to set up a Pty Ltd. I asked him WHY he wanted to do it – seemed like a logical question to me. His reply was that his wife was a decorator and she wanted to take him (husband) on as an apprentice. It seems there is a financial incentive to train people and they wanted to take advantage of it.
He had inquired and was told he had to have a company. I threw another WHY into the equation. He hadn’t asked that even though he had been confused by the instruction. Further questioning showed some degree of sensibility but it was not him who had to have a company but his wife – the person who would be employing him as an apprentice.
It seems that they were already running the business as a partnership meaning that as he was part ‘owner’ he couldn’t be an employee (apprentice). Under a company structure he could. I could see two options. One – the wife returned to a sole trader or Two – for her to set up a company. Either way she could employ the husband and perhaps qualify for the subsidy. Either way she would need to have insurance and pay proper wages. The subsidy would cover part of the latter but not all the costs of having an apprentice. If she opted for a company the costs would be higher as would the tax and by changing to sole trader they couple would lose the benefit of tax at partnership level.
I did not have a copy of the apprenticeship qualifications so I could not advise him further so I gave him a bag of why’s and sent him back to get more answers.
Written by Maggie Richardson
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