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How to start a business

How to start a business

13 April 2018

Are you ready to turn your business idea into reality? Here's what you’ll need to do to make this happen.

Starting a business can be exciting, but also risky. Your business will need to be set up for a few things before you can expect to start turning a profit.

What you need to do generally depends on your business structure, projected annual sales and industry. Start your business the right way by understanding and completing all your registration requirements.

Set up your business

Once you’ve completed a business and financial plan and are confident your business idea could be successful, you’ll need to choose a business structure. This will impact how tax, liability and ownership rules apply to you.

Once you’ve done this, make sure someone else isn’t running a business with the same name you’re thinking of using. Run a trademark check first.

You’ll then need to:

Note: If you plan to run your business through a company then you must get an ACN before you get an ABN.

Tax File Number (TFN)

All businesses need a tax file number. If you’re a sole trader you can use your individual (personal) TFN, but if you’re running a partnership, company or trust-based business, you’ll need to get a business TFN.

Goods and Services Tax (GST)

If you expect your business will have annual sales above $75,000 you’ll need to register for GST. It’s a tax of 10% applied to most goods, services and items sold in Australia.

You can obtain an ABN, TFN and GST registration at the same time by visiting www.abr.gov.au.

Business licences and permits

Depending on what type of business you run and where you run it from, you may need a licence, permit, registration or certificate. It’s also a good idea to check with your local council to see if you need to lodge a development application or building application before your business can start.

The Australian Taxation Office (ATO) website offers advice, video content and step-by-step guides to help you become familiar with Australia’s tax laws.

Separate your business finances

Once you’ve set your business up, consider separating your business and personal accounts. This can help you keep track of business-related expenses (especially at tax time) as well as manage your cash flow.

Keep reading

This article is intended to provide general information of an educational nature only. It does not have regard to the financial situation or needs of any reader and must not be relied upon as financial product advice. Taxation considerations are general and based on present taxation laws and may be subject to change. You should seek independent, professional tax advice before making any decision based on this information. Commonwealth Bank is also not a registered tax (financial) adviser under the Tax Agent Services Act 2009 and you should seek tax advice from a registered tax agent or a registered tax (financial) adviser if you intend to rely on this information to satisfy the liabilities or obligations or claim entitlements that arise, or could arise, under a taxation law.