Do You Operate Out Of A Unit Trust But Wish You Operated Out Of A Company?

Many successful recruitment businesses start small. In later years, they can often find themselves operating out of a business structure that is not appropriate for the business going forward. The structure may have been set up with advice from a family friend or a suburban accountant. An example of an inappropriate structure is a unit trust.

Operating a business out of a unit trust can make it difficult to maintain working capital as there is a lack of freedom with regard to profit retention and distribution. In addition, you may be require to explain the unusual structure to clients, banks and suppliers who may not be as comfortable as they would be had you been operating out of a company.

If your recruitment business is currently operating out of a unit trust there may be ways to transfer the business to a company without incurring capital gains tax or stamp duty.