1. Legal and Practical
Issues to Consider
in Incorporating
Patent Attorney
Practices
Mark Vincent
Partner

2. Introduction overview of issues to set the scene for further speakers
why bother incorporating?
what are the costs and other issues to consider?

3. Introduction (contd)
The legal practice story since the Legal Profession (Incorporated Legal Practices) Act 2000 (NSW).
733 of 4247 NSW firms had incorporated, or were in the process of incorporating at 30 June 2007
recent high profile public companies (Slater and Gordon and Integrated Legal Holdings)
duties to court, professional duties to clients and duties to shareholders
professional standards issues for lawyers
cost/benefit analysis

4. Why bother?
Show Me The Money!

5. Why bother? pay less tax take home more money
A Show me the money!
pay less tax
take home more money
reduced availability of other means of income streaming

6. Why bother?
Protect Your Assets

7. Why bother? B Protect Your Assets
the “corporate veil”, insolvent company, creditors can’t pursue shareholders
directors have significant exposure (but less than partners, at least to most creditors)
revenue can be made more secure in the hands of family trusts
don’t take on unlimited liability for your partners’ problems

8. Why bother?
Flexibility

9. Why bother? C Flexibility
no need for service trust, administrative simplicity
non attorney shareholders and directors
staff retention, share options
succession can be easier than with a partnership which dissolves and reforms with each partnership change
retention of working capital
when you are out of a company, you are out, liabilities of a partnership can have a long reach.

10. Make sure you know what you are getting yourself into.
Why not?
Make sure you know what you are getting yourself into.

11. Why not? costs, legal accounting, other
audit for large private companies (more than 50 staff and $10 million in turnover)
payroll tax
compulsory super
capital gains tax
stamp duty
what are actual quantifiable benefits?

12. Options PARTNERSHIP PTY LTD COMPANY
HYBRID – Company as Agent for Partnership of Trusts, Unit Trust etc.
A Show Me the money x 
B. Protect your Assets
C Flexibility
Costs v Benefits
Opportunity Costs?
Consider Carefully

13. Depends on individual circumstances. List is not exhaustive.
Checklist
Depends on individual circumstances. List is not exhaustive.
Issue
Comment/
Assesment
Income Splitting
Audit Costs for large companies
Firm vision for the next 5 years
Accounting Costs
Stamp Duty
Legal Costs
Payroll Tax
Staff Retention
Compulsory Super
Succession Planning
CGT
Quantifiable Benefits

14. Conclusions Framework to keep in mind as the detail unfolds with further speakers
Questions?