When you make the decision to start your own business you step onto a roller coaster ride the likes of which you have never ridden before! It is both exciting and terrifying at the same time. On one hand, you’ll finally be the boss and the master of your own destiny. Generally, you choose to get into a business that revolves around something that you’re truly passionate about. That is exciting. But it also means that you now have a list of things that you need to complete before you even make that first dollar!
Working for someone else means that you don’t shoulder the legal responsibilities or stresses. This all adds to the jangling nerves.
We’ve put together a list of the main things you need to sort out when starting a new business in the hope that this:
1. Choose your business structure.
The first thing to do is to decide which structure best suits your circumstances. The structure you choose for your business is very important, as it has a direct effect on things such as:
- Your level of control
- The amount of tax you need to pay
- Regulatory obligations
- Health and safety requirements in the workplace
- The level of personal liability you will incur
There are more than 60 different business structures.
You can add multiple layers around your trading company to further enhance protection and minimisation of taxes
The four main structures on which you can build your business:
Sole trader: This is when you register someone (usually, you) as the sole and only owner of the business. The implications of that are that you are responsible for all legal aspects of running the business. You’re allowed to hire people to work for you.
Company: This is a commercial business or entity that has a separate legal existence to its shareholders.
Partnership: A Partnership is when more than one person and/or entities run a business together, but not in the form of a company.
Trust: A Trust is an entity that is in possession of property, income, or any other assets for the benefit of a third party.
You must decide on the structure of your business before you register it. Each structure entails different steps to register the business. So, decide the structure first. It is important to get this right and it is not unusual for new businesses to seek help and guidance from an Accountant. They are the specialists as far as working out which works best for you.
2. Pick a business type.
With a structure in place, you can better understand the type of business you’re likely to need. There are a myriad of business types to choose from, and some of the main types include:
- An online business
- A franchise
- Independent contractor
Every industry has a different set of legal obligations and regulatory requirements. It is crucial that you pick the business type that best suits your industry.
3. Apply for an Australian Business Number (ABN) and register your business name.
You can’t legally start a business in Australia unless you own an ABN. This is an 11-digit number that is unique only to your business and acts as a government identifier for the business.
Once you’ve got an ABN, you’ll be able to:
- Register your business name
- Identify your business to other entities for things like ordering goods and services or sending invoices
- Claim taxes such as Goods and Services Tax (GST)
- Avail of credits for things like energy grants
- Buy a .com.au domain name
You should decide on your business name before you start paying someone to create assets like your website URL and logo. You’ll need to change everything in the event that your business name changes. If you do create a business logo, it’s worth considering if you need to patent it to protect yourself from copyright infringement.
You can register your ABN and business name separately and by yourself if you wish. Many new business owners get their accountant to do this for them.
4. Register your domain name.
You can only complete this step after you’ve secured your business name and ABN. You cannot get a .com.au address unless you are a registered Australian business. The domain name you pick should be related to your business in some way. Make it easy for prospective customers to find and recognize you easily.
While you might have the perfect domain to go with a killer business name, you’ll still need to check that someone else hasn’t taken it already. There are lots of sites out there that can help you with that. Again, many business owners who are just starting out look to a professional for some help. If you want to have an informal discussion about your needs, please contact Unni by: telephone, 0458 774 523 or email, unni@stpaccountants.com
