Was one of your goals for this year to start your own business? If so – congratulations – that’s an awesome goal!
Time to get organised and get into action. The decisions made in the early stages of forming a business are important.
One of the first decisions to be made is how to structure the business.
Above all, get good advice about the business’s structure up-front. The business’s structure will determine things like:-
- tax liability
- asset protection
- ongoing costs
- volume of paperwork
- reporting requirements
- what responsibilities and duties the business’s owners will have
- whether the business owners can be held personally liable for the business’s debts
The different types of businesses
As a general rule, businesses can be structured to operate: –
- as a sole trader
- through a company
- in partnership with someone else
- through a trust
- as part of a franchise
Talk to your lawyer, accountant or financial or business advisors about which business structure suits your situation.
Free online resources
The Government publishes free online resources (click here for an example) to help business owners work out which business structure best suits their situation.
Licensing and other requirements
One thing we often see as lawyers is business owners being caught-out by specific licensing, legal or other regulatory requirements related to the product or service their business is selling.
Make sure you check with the Australian Business Licence and Information Service (ABLIS) for any licences, registrations or permits you need to operate your business. Most importantly, make sure you understand any legal obligations you have to meet in order to avoid fines and penalties.
Running your own business can be challenging but also hugely rewarding. Seek professional advice along the way, and best of luck with your new adventure!
Need more help?
Do you need more information about business structures? Start your business today! Click here to connect with our Property and Commercial Team.