BUSINESS STRUCTURES AND TYPES
There are a number of structures that you can choose from when starting or expanding your business.
Four main structures
The four main business structures commonly used by small businesses in Australia are:
Sole trader: an individual operating as the sole person legally responsible for all aspects of the business. Like other structures, as a sole trader you can employ people to help you run your business.
Company: a legal entity separate from its shareholders.
Read about the differences between a sole trader and a company to understand the tax differences, your potential personal liability and the legal obligations when employing people.
Partnership: an association of people or entities running a business together, but not as a company.
Trust: an entity that holds property or income for the benefit of others.
Choosing a structure
When deciding on a structure for your business, choose the one that best suits your business needs, keeping in mind that there are advantages and disadvantages for each structure.
It's important to investigate each option carefully, as choosing your business structure is an important decision.
Your business structure can determine:
the licenses you require
how much tax you pay
whether you're considered an employee, or the owner of the business
your potential personal liability
how much control you have over the business
ongoing costs and volume of paper work for your business.
You can change your business structure throughout the life of your business. As your business grows and expands, you may decide to change your business structure, or to restructure your business. We will help you understand your own particular circumstances and the specific advantages and disadvantageous to each business structure.