Starting a business

You need to determine if you are capable of starting a business because not everyone is eligible to start a business in Australia. There are people who are disqualified automatically and can’t start or manage a business. one of such persons is bankrupt. For that period of bankruptcy, the person cannot manage any business, which also means that they can’t start a business. Furthermore, the Australian Securities and Investments Commission can disqualify someone from operating a business if they have been part of at least two liquidated companies within the past seven years. Once certain entities are disqualified from operating a business, it also means they can’t start one.

Eligibility

Business Structure

If you are eligible to start a business, the next thing you have to think about is the business structure. Businesses can have different structures, and choosing the one that suits your business is essential. There are four major types of business structures that you can opt for. They are

Sole trader or proprietorship

This is a very simple structure with only a few tax and legal formalities. As a sole trader, all aspects of the business are your responsibility, and you have full liability. For this, there is no need to register if you are conducting the business with your personal name.

Partnership

This involves two or more individuals or entities who manage and control the business. All partners share the liabilities and obligations.

Trust

This is a deed in which the obligation is imposed on a person who is the trustee and holds assets or property for the benefits of the beneficiaries. It requires a formal deed.

Joint venture

This is a venture with two or more individuals, and entities come together to do business on a certain project or particular purpose instead of an ongoing business.

Company

A legal entity that is separate from that of the owners. It has similar legal rights that a natural person has, and the owners can limit their personal liability. The taxes and administrative procedures are more complicated, and it must be registered.

Registration

You also need to register a business name which is the name with which you conduct your business. It is necessary if you are using a name that is different from your personal name to conduct business, or you are starting a company. The name can only be registered for a period, and you will have to renew periodically. It is also important to get the Australian Business number.