Cruz and Co

We know tax. Let us look after yours.

  • Home
  • About
    • Meet the Team
    • Our Clients
    • Testimonials
  • Services
    • Tax Consultant and Compliance Services
    • Small Business and Sole Trader Accountant
    • Outsourced Accounting Solutions
    • Business Structure
    • Outsourced CFO
    • Working Visa Refunds
  • Resources
    • Tax Refund Process
    • Client Assistant Schedule forms
    • Downloadables
    • Helpful Links
    • Rental Property Cashflow calculator
    • SMSF Tax Refund Process
  • Contact Us
  • Blog

Connect with us

  • Facebook
  • LinkedIn

Are You Paying Your Staff, but Not Paying Yourself a Proper Salary?

By Nina Hendy

Sydney creative agency owner Tamlyn van Zyst admits she didn’t pay herself a salary for the first nine years in business.

“Luckily I had a very supportive husband who was happy to pay the mortgage. But looking back, it was crazy given that the business was successful from the outset.”

Reinvesting in the business

The owner of Tamlyn Creative had valid reasons for not paying herself a market-rate salary.

The money that would have been her wage was instead being reinvested back into the business, she says.

“The money that would have been my wage was always needed for something else. When you’re setting up a new business, you need new equipment and to pay staff. There’s always something.”

As the business grew, she hired more staff and of course paid each one market wages, but continued to deny a wage for herself.

She also hired an accountant and leadership mentor, which is how the non-payment issue was discovered. Together, they worked out a strategy to gradually carve out a market wage for running a small business in her industry.

Self-funding

However, van Zyst is by no means alone.

SME growth coach, accountant and entrepreneur Tanya Titman has worked with hundreds of business owners in the past 20-plus years who don’t pay themselves a market-rate salary – sometimes for several years.

“Almost 60 per cent of the people coming into our courses aren’t paying themselves a market salary. Sometimes this goes on for years, even despite their business thriving. And yet often, they see themselves as having a profitable business,”

Not paying themselves a wage means that a small business owner is essentially self-funding their own business. What many don’t grasp is that small businesses need capital to grow, she says.

Poor financial literacy could be a barrier to growth for SMEs.

Titman, who runs a course for women wanting to improve their financial literacy, says many people she’s worked with admit they didn’t realise that the road to self-employment is harder than they anticipated.

“Self-employment can be a tough road unless founders have the business and financial skills to ensure their company delivers greater financial rewards than traditional employment,” she says.

“Starting a business is a long and challenging road and not for the faint-hearted. The rewards need to be there to support and justify the journey.

“And unless you’re clear on why you’re starting or continuing your entrepreneurial journey and are willing to commit to the challenge, the financial rewards are simply unlikely to be there.

Simple adjustments

Often, some simple adjustments such as a more robust business plan and a restructured pricing strategy can lead a struggling small enterprise into profit, she says.

Speak to your accountant about how to implement a market wage for your position at the helm of your business, bearing in mind it could take some time to build up to a full salary, Titman says.

The need for better financial literacy looks only set to increase given the growing number of Australians with dreams of small business ownership.

Almost a third (31 per cent) of Australian adults are either currently self-employed (13 per cent) or are considering becoming so in the future (18 per cent), according to a survey conducted by Pureprofile.

Young people are particularly keen on small business ownership. The research found that 36 per cent of those aged 25-34 years expressed an interest in starting their own business. The national Pureprofile survey included 1000 Australians aged 18 years and older.

The findings align with a global trend towards entrepreneurship, with Millennials starting twice as many businesses as their parents, according to the 2016 BNP Paribas Global Entrepreneur Report.

Four years ago, van Zyst started paying herself a market salary. She recommends other small business owners pay themselves properly from the outset.

“I regret not doing it sooner, to be honest. There’s no point being in business if you can’t financially look after yourself. I actually gave myself a pay rise recently. It’s rewarding when you can do that in your own small business.”

Five questions to ask before taking the step into self-employment

  1. What is your end goal?
  2. Are you passionate and confident enough about your business idea to take the risk?
  3. Do you have sufficient resources to support your journey?
  4. Have you mapped out a business plan and a realistic pricing strategy?
  5. Do you have the right support networks around you?

 

Source: The Age

Testimonials

  • Jonathan Fambart

    Business Tax – Travel Industry

    Cruz & Co was introduced to me this year and it was the best decision for my sole trader and personal taxation affairs. Ritchie the…

    Read full testimonial
  • Daniel Robey

    I have and continue to recommend Cruz and Co to many businesses and individuals who are looking for a business advisor and accountant that goes over and above…

    Read full testimonial
  • Jonathan Yeoman

    Director, Technical Design Company

    This is a new business startup and Cruz&Co. have provided great help, guidance and reassurance from the beginning.

    Ritchie has provided us with excellent service and…

    Read full testimonial
  • Vanita Aloda

    Restaurant Owner

    Ritchie Cruz is my Accountant. We have a solid 10 year relationship.

    Ritchie as always provide me with honest and efficient service.

    Is a great communicator, always replies efficiently to…

    Read full testimonial
  • Dr Krish Perananthan

    Cosmetic and Implant Dentistry

    Ritchie was recommended to me by my father and I have also continued to recommend him to my friends. He is reliable, efficient and has a…

    Read full testimonial
  • Jae Kwon Yoo

    Business Tax – Electrical Contractors

    Ritchie is awesome. He is very professional and responsive and he is always there to help you. He even replies during weekend. He needs some…

    Read full testimonial
  • Napoleon Guines

    Director, Travel Company Operations

    Ritchie Cruz and Co are accommodating and have excellent service.

    Cruz & Co have impressed me the most is due to their efficient service.  They are…

    Read full testimonial
  • Regina Wang

    Business Tax – Beauty Salon 

    Ritchie has been managing my tax matters as a sole trader for 2 years+. Always very responsive to my questions and make effort to reply…

    Read full testimonial
  • Zac Fryer

    Director, Import and Distribution Company

    Ritchie Cruz provides and high level of accounting expertise and goes above and beyond in answering any queries we have.

    Read full testimonial
  • Kellie Pincham

    Director
    Automotive Parts Retailing business

    Cruz & Co offer a great professional and friendly service. Ritchie gave me confidence running the business knowing that he was readily available for…

    Read full testimonial

© 2025 Cruz & Co.

  • Home
  • About
    • Meet the Team
    • Our Clients
    • Testimonials
  • Services
    • Tax Consultant and Compliance Services
    • Small Business and Sole Trader Accountant
    • Outsourced Accounting Solutions
    • Business Structure
    • Outsourced CFO
    • Working Visa Refunds
  • Resources
    • Tax Refund Process
    • Client Assistant Schedule forms
    • Downloadables
    • Helpful Links
    • Rental Property Cashflow calculator
    • SMSF Tax Refund Process
  • Contact Us
  • Blog