Professional Services
Accounting for Professionals Who Advise Others — But Need Advice Themselves
Business structure, tax planning, contractor management and BAS — handled by an advisory-led firm that understands professional services.
Professional services firms — consultants, lawyers, financial advisers, engineers, architects, and other service businesses — face specific accounting challenges around business structure, personal services income rules, and tax efficiency. ANH Accounting works with professional services practices across Sydney.
The accounting challenges professional services face
We have seen these issues repeatedly — and know exactly how to resolve them.
Personal services income rules
The PSI rules can deny deductions and attribute income to the individual rather than the company or trust. We assess whether your income qualifies as PSI, whether the results test is met, and structure your arrangements to be both tax-effective and defensible.
Contractor vs employee classification
Professional services firms often engage contractors. Misclassifying employees as contractors creates significant back-liability for super, PAYG, and potentially payroll tax. We review your contractor arrangements and document them correctly.
Business structure for tax efficiency
Operating as a sole trader at a marginal tax rate of 47% versus a company at 25% or a trust that distributes income creates large differences in annual tax. The right structure depends on your PSI status, family situation, and risk profile.
Trust account obligations (legal)
Legal practitioners have specific trust account obligations under state law. We ensure trust account reconciliations meet the requirements of the Legal Profession Act and integrate correctly with your practice accounting.
What we do for professional services
- Business structure advice (company, trust, partnership)
- PSI assessment and planning
- Annual tax returns
- BAS / IAS preparation & lodgment
- Xero bookkeeping
- Payroll & contractor management
- Tax planning and minimisation
- ATO correspondence
What you can expect
Business structure optimised for your income level and risk profile
Contractor arrangements documented and compliant
Every legitimate deduction captured
Tax position reviewed and planned before year end
Why professional services choose ANH Accounting
Start with a free 30-minute session
We review your situation, identify savings opportunities, and outline exactly what we can do for your professional services business — no charge, no obligation.
After hours & weekend appointments available
Common questions from professional services
Can a consultant or adviser use a company or trust structure?
Yes, subject to the personal services income (PSI) rules. If your income is genuinely from a business activity — you have multiple clients, operate from business premises, risk liability, and could subcontract — you may be able to structure income through a company or trust and significantly reduce your tax. We assess your specific situation and provide written advice on the most appropriate structure.
What business structure is best for a consulting firm?
There is no single best structure. A sole trader is simple but exposes all income to the marginal personal rate. A company provides the 25% corporate tax rate but has distribution limitations. A discretionary trust provides income splitting flexibility but cannot retain earnings at a low rate. Most consulting businesses at a profit of over $100,000 benefit from either a company or trust. We model the numbers for your specific situation.
What can professional services firms claim as tax deductions?
Deductible expenses typically include professional indemnity insurance, professional memberships and registration fees, CPD and training, business travel, home office expenses (where genuinely used), client entertainment (subject to FBT rules), staff salaries, software subscriptions, and accounting fees. We conduct an annual deductions review to ensure nothing is missed.
Ready to get your accounting handled properly?
Book a free 30-minute session with ANH Accounting. We'll review your current situation, find opportunities, and tell you exactly what we can do for your professional services business.
Registered Tax Agent RN 26258346 · IPA · IFA · CPA · CA · Xero Certified · Est. 2018