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Peter is considering establishing a property management business in Darwin called PPM Services (Peters Property Management Services). He and his wife Susan have come to you seeking advice about an appropriate business structure for his business. They want to know of the different options, advantages and disadvantages of the business structures. Susan is concerned about protecting their house for their young family, as she has heard of cases where the family house is lost when the business fails.
Peter will initially be starting the business by himself with some help from Susan. He may later ask his friend Jack to join in the business as Jack can bring in additional capital and business skills to expand the business.
They are specifically interested in the following advice:
(1) How does he register his business? Can Peter conduct a business in his own name? How will he include Susan as a co-owner of the business?
(2) What are the elements of a company and what is the process of registering a company? Can Susan also be a part owner of the company?
(3) What are the advantages and disadvantages of operating a business as a company rather than a sole trader or partnership?
(4) How can he arrange for Jack and other friends join in the business at a later time?
(5) How can Peter and Susan protect their personal assets in case the business fails? Are there other structures that will ensure that their house will always be protected from the creditors?
(6) What are the reporting obligations of the business and how are the various businesses structures regulated?
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