Signs tradies have outgrown their setup
Most trade businesses start the same way: an ABN, a ute, a phone full of customers and receipts on the dashboard. That works for a while. Then the business grows, and the setup that was fine for one person working alone starts costing money, time and sleep.
These are the signs we see most often.
1. The paperwork happens at 10 pm
If you’re quoting, invoicing and doing the books after a full day on the tools, things get missed: invoices go out late, receipts get lost, and deductions go unclaimed. It’s the most common sign, and the easiest to fix.
What to change: move to Xero or similar with bank feeds and receipt capture, quote and invoice from your phone on site, and consider handing the bookkeeping over. Ours is from $90 + GST a week. See how to keep accurate business records.
2. You don’t know which jobs make money
Busy all year, but the bank balance doesn’t show it. Usually that’s because some jobs, or some types of work, are losing money and the good ones are covering for them.
What to change: track costs against each job, and review your charge-out rate and margins. See how do I make my quotes profitable?
3. Cash is always tight
Materials bought up front, builders paying in 30, 45 or 60 days, and a BAS due on top. Growth makes it worse, not better.
What to change: deposits and progress claims on bigger jobs, invoicing the day the work’s done, and a separate account for GST and tax. See profitable but cash poor?
4. The BAS is a shock every quarter
If you’re not putting GST aside, every BAS feels like a bill you didn’t expect. Fall behind and the ATO debt builds quickly.
What to change: move GST and PAYG withholding into a separate account every week. If you’re already behind, lodge on time anyway and let us arrange a payment plan.
5. You’ve crossed $75,000
Once your GST turnover reaches $75,000 in a 12-month period, you must register for GST within 21 days. Missing it means paying GST you never charged.
6. You’re thinking about your first apprentice or worker
Taking on staff brings payroll, super, Single Touch Payroll, workers compensation, award wages and leave. Taking on subbies brings the contractor-versus-employee question and, in construction, the Taxable Payments Annual Report (TPAR) each August.
What to change: set up payroll properly from the first pay, and check whether a subbie is really a contractor. See contractor or employee?
7. You’re taking on bigger jobs, or own your home
As a sole trader, your house is on the line if a job goes wrong or a big customer doesn’t pay. Larger contracts, commercial work and builders’ requirements increase that risk.
What to change: look at whether a company structure makes sense, along with the right insurance. See when to switch from sole trader to company.
8. Your tax bill keeps going up and nobody’s told you why
Profit grows, the tax bill grows faster, and the first you hear about it is in October.
What to change: a tax planning meeting before 30 June, every year, to plan vehicle and tool purchases, super contributions and structure while there’s still time. It’s included in all our business packages.
9. You need finance for a ute, truck or equipment
Paying cash for a vehicle out of working capital can leave the business short for months.
What to change: match the finance to the asset. A chattel mortgage lets a GST-registered business claim the GST up front and spread the cost. Judge Lending can arrange it, and your accountant can tell you the tax effect first.
You don’t have to fix everything at once
Most tradies we work with start with the books and the BAS, then structure and planning once the numbers are clear. Our Sole Trader package is $80 + GST a month, and the first consultation is free. Bring your last BAS and your Xero login if you have one.