BERRY BREYER has been Australia’s most successful law firm since its founding in 1949, but it has been struggling to find a way to stay afloat amid the global economic crisis.
Key points:Birney Beryer is one of the most successful Australian law firms in the worldWith a turnover of more than $3bn, Birney’s revenue in 2017 was $8.6bnThe firm’s financial troubles stem from the financial crisis and have been compounded by a new tax lawIn 2017, the Australian Taxation Office (ATO) announced that it would begin taxing income earned by a business through the withholding of corporate tax and withholding from income received by the business.
Under the new rules, businesses would have to file their annual return in one of three formats, with the most popular being a corporate and withholding tax return.
Birney would then have to make its own tax return, but under the new laws, it would only have to pay tax on income it received.
While the ATO initially said that the new tax regime would result in a tax reduction of between 2% and 2.5% for businesses and households, the number of businesses and individuals who would be affected by the changes was not announced.
In 2017 and 2018, the firm was hit by the financial crises in which it was hit hard by the collapse of the mining industry.
Birnais loss was so severe that it eventually went bankrupt and it had to close its doors in the autumn of 2020.
It later reopened as a new law firm, but was forced to pay out more than half of its annual revenue in 2018.
Birneys financial woes are compounded by the new Tax Law, which has been introduced by the government.
The new tax will apply to the income earned from self-employment, partnerships, limited partnerships, trusts and estates.
The ATO says the new legislation will reduce the rate of corporate and personal tax for businesses by between 2.1% and 4.2% and for individuals by between 1.5%, 4% and 5% and will increase the tax paid by businesses by about 5%.
However, in the past, the company has had to go into voluntary bankruptcy and the ATOs refusal to pay up on its debts means Birneys financial troubles are not over yet.
The law firm has also had to seek advice from other firms, including the US firm, Morgan Stanley, who has advised the firm on its taxation affairs.
Birsey Breyers chief executive, Peter Birney, said the new law was a welcome development.
“I believe it is the right move, the right thing to do, and we believe that it will have an enormous positive impact on the business of Birneys,” Mr Birney said.
“We know the tax code is complicated and that’s why we’re so pleased to see the ATOG, the ATOA and the Treasurer’s office to take a fresh approach to taxation.”
Birney has had its share of troubles in the years since it was founded in 1949.
In 2010, it was forced into voluntary liquidation after its share price plunged by more than 30% following a $30 million funding shortfall.
It has been in a long-term dispute with a Chinese businessman over his shareholding in the firm, and in 2012 the firm said it was being forced to close the doors of its Melbourne office, where Birney had its offices, due to the financial woes of the firm.
It also faced financial troubles after the closure of its Australian headquarters in the early 2000s, and its legal department was forced out in 2013.
It is not the first time the Birneys business has been hit by a financial crisis.
In 2006, it had its head office in Sydney forced to shut down, and then in 2009, it also faced a funding shortfall when it went into voluntary voluntary bankruptcy.
Birnie’s financial difficulties are not the only thing that has caused it to struggle.
In 2013, the Sydney Morning Herald reported that the firm’s annual revenue fell by more of $4.6 billion in the year to the end of the year, and had to be paid out in instalments.
In a statement to the ABC, Birneys chief executive Peter Birnais said the law firm was not going to be forced to sell the offices.
“The company will be able to continue to provide services in Australia, as it has for more than a century, but its business is being affected by a range of financial challenges,” Mr Bernais told the ABC.
“We have been forced to make substantial savings to maintain our business and remain viable, and that is all that is required for us to be able continue to fulfil our mandate and deliver services to our clients.”