Barbara Trad

Background

About Barbara Trad

My thesis explored key considerations underpinning a crucial decision when commencing a business — what are the driving motivations of small and medium enterprise (SME) advisors, when recommending a business structure at the inception stage of the business? The thesis explored the reasons for business structure choice in Australia, in particular the use of discretionary trusts for business operations. A mixed method was used for this thesis, with interviews in Stage One, and the case study and the survey in Stage Two. The findings provided evidence that tax planning considerations were an important factor for the chosen business structure, with discretionary trusts featuring heavily in many of the recommended structures. Frequently there was a combination of structures recommended for the one business operation, to provide the desired mix of tax and commercial advantages. The qualitative and quantitative results were drawn on to recommend tax policy reform to improve the taxation of SMEs in Australia. To address tax structure biases, and income splitting, a recommendation is to introduce the family as a unit of taxation rather than taxing individuals. It is also recommended that the tax system be reformed to provide greater equity and neutrality in taxing business income, regardless of the chosen legal structure.