Dreaming of starting your own business in Australia? Can’t wait to finally be your own boss as you venture into the untapped market potential that is Australia? As thrilling as that may be, you will need to first understand that there is much preparation that needs to be done before you start your own business venture there.
Unlike working under someone else, where you only need to worry about your own personal problems. Opening up a business venture in Australia is a completely different can of worms to worry about. Each country has different laws, regulations and requirements before you are allowed to start up business in the country. Being knowledgeable in business does not equate to being successful in setting up a business in a different country. To help you achieve success in this overseas endeavor, here are 6 tips on starting your own business in Australia.
1. Choosing your business structure
The structure of your business dictates certain things such as:
- Level of control
- Payable tax amount
- Regulatory obligations
- Workplace health and safety requirements
- Personal liability incurred
In Australia, there are 4 structures that you can base your business on:
- Sole trader: This is where you register yourself or someone else as the sole owner of the business. As such you will be liable for all the legal aspects of running the business, but you’re entitled to hire workers for your business.
- Company: A legal commercial business or entity which existence is separate to its shareholders.
- Partnership: A partnership is as the name implies, you register your business with more than one person/or more entities but not as a company.
- Trust: A trust is an entity that’s in possession of property, income or any other assets for the benefit of third parties.
It is important to know your business structure before registering as each structure has differing registration processes. It is also worth noting that your business structure may change with time, hence the importance of knowing these structures beforehand.
2. Picking your business type
Once you’ve decided on the structure, you must choose your business type. There are as many business types as there are stars in the sky. But the usual core business types are:
- Online businesses
- Independent contractors
Picking a business type that suits your industry would be a wise choice as each industry has different sets of legal obligations and regulatory requirements.
3. Applying for an Australian Business Number (ABN) and registering your business name
Without an ABN you are not allowed to legally start business in Australia. Hence why it is crucial that you apply for this 11-digit number first in order to tie your business to your name and this also allows the government to identify your business. Benefits of having an ABN are:
- Registering your business name
- Identifying your business to other entities for the purposes of ordering goods and services or sending invoices
- Claiming taxes such as Goods and Services Tax (GST)
- Be eligible for credits for things like energy grants
If you’re planning on creating assets like websites, logo or designs of any sorts, then it’s best that you register your business name first. Otherwise should your business name change after registering, you will have to redo everything from the beginning. As an additional note, if you do plan on making a logo, you should consider registering for a patent for it to protect yourself from any copyright infringement.
Do note that it is possible to register your ABN and business name separately, but it is strongly advised that both be applied at the same time.
4. Registering your domain name
f you wish to register for a domain name, then it is a must that you already have your business name and ABN. You are required to be a registered Australian business to be able to acquire a .com.au address. To make it easy for customers to find and recognize your business, you should pick a domain name that is related to your business. After doing that, you should check the availability of the domain name you picked. Should the domain name be free then you can proceed, if it is not available then here is a website to save you the hassle of going through the trouble of re-picking a new domain name again and again.
After confirming the availability of your domain, then you may proceed to the .au Domain Administration Ltd (.auDA) website to find links to domain registrars and resellers to survey the pricing for securing your domain name.
5. Identifying your funding source
As with many startups, funding should be your primary concern. No point having an amazing business strategy if you cannot afford to maintain your own shop. In light of this, you should consider finding out what resources are available to you to ensure that your business can start out smoothly.
While government grants may not be available to your business, there are also plenty of options that are available to specific states. For example, if you’re starting a business in Adelaide then you may apply for a $20,000 Small Business Development Funds.
Other grants are available based on:
- Taking your idea to market
- Marketing and sales
- Equipment procurement
- Import and export
- Worker employment
6. Registering for the correct taxes
Taxes are part and parcel of starting up business in Australia. Hence it is of utmost importance that you register for the correct taxes to avoid potential legal implications. Which taxes you have to register for depends entirely on the type of business you chose. Some taxes are only mandatory to certain types of businesses, then there are also some that are mandatory across all fields.
- Goods and Services Tax (GST) – this is compulsory for businesses with a turnover of $75,000 AUD or higher
- Pay as You Go (PAYG) withholding tax – should you require to withhold an amount for tax purposes, for example, paying wages or salaries, then you will require to register for this one.
- Fringe Benefits Tax (FBT) – you will be required to register for this tax for if you provide perks like a company car to your employees.
Once you’ve got everything sorted out, you are now ready to start your business. While starting a business on foreign soil may be out of your comfort zone, as long as your business strategy is sound and your networking is solid. There is no reason to worry about starting up your business in Australia. Should you require any assistance migrating your business to Australia, drop us an enquiry at [email protected]