Starting a Business in Australia Checklist – An Essential For Start-Up Business Owners

Author: Zeinab Farhat, Progressive Legal

If you’re in the exciting process of building a new business, it is essential to adopt sound business practices and set up a comprehensive “Starting a Business in Australia” checklist. This checklist will not only help you streamline your operations but also pinpoint areas where adjustments may be necessary.

This guide serves as a valuable resource to supplement professional advice as you embark on your entrepreneurial journey. By delving into key aspects of your business, fine-tuning your business plan, safeguarding your enterprise, staying updated on legal requirements, optimising your workforce, addressing commercial documentation, and exploring other crucial factors, you’ll be equipped with the knowledge to ensure your business’s success.

Let’s get straight into it.

Establishing the Key Aspects of your Business 

Let’s get into some of the key features to identify about your business: 

Identifying your business structure  

If you are in the planning stages of your business, it is imperative that you consider what type of business structure is best for you.  

The main thing to consider is really only operate as a sole trader if this is a hobby, as a general rule. The problem is that you and the business are one and the same. That means if something was to happen to the business, you are personally responsible. Whereas a company provides separate legal entity and significant legal protection. Obtaining this really important advice from the start can sometimes save the day completely. You should obtain this specific legal advice and also in conjunction with financial advice from an accountant and put them both together to make a considered decision. All business is risky, that is why they call it risky business.  

The different types of business popular structures are briefly summarised below: 

1. Sole Trader: If you are a sole trader, this is the simplest type of business structure and gives you complete control. However, as a sole trader, you and your business are one and the same. As such, the sole trader structure opens you up to considerable legal liability by exposing your personal assets should things go wrong.  
2. Company: Incorporating as a company means your business is a separate legal entity. As a result, limited liability applies to separate the company from its owner(s). This is particularly pertinent where the company faces financial loss, debts or incurs some form of legal liability.  
3. Partnership: Partnerships consist of two or more people who are jointly and severally liable for business losses, as well as distributing income among the partners.  
4. Trust: A trust is where a trustee conducts business affairs on behalf of nominated beneficiaries. 
5. Co-operative: Co-operatives are owned by members and have at least 5 members. They are legally incorporated entities specifically designed for the interests of members.  
6. Joint Venture: Joint ventures are agreements between 2 or more parties relating to a specific task.  

Each of these business structures carry their own risks and operate differently. Before choosing one, it is best practice to consider which is the most beneficial for your business, and it is best to obtain professional advice from a lawyer and/ or accountant before setting up any of these structures. 

Identifying your business name  

Your business name is how consumers will identify you among your competitors. 

It is important that prior to settling on a name, you have considered whether there are any similar names. This involves doing your due diligence as to any enforceable intellectual property rights people may also have (such as a trademark over a name that you may be interested in). By doing this, you ensure that you are not infringing other people’s rights.  

Further, you may also want to identify whether any domain names are registered with your potential business name. If your desired domain name is free, you should register ASAP before the name is taken. This includes registering for the .au domain name.  

Under the Business Names Registration Act 2011 (Cth), you are also required to register a business name unless you fall within an exception under s 18(2). See here for a long form article on business names.  

Ensuring compliance with any licenses or registrations you may require  

The nature of any licenses or registrations you may require is dependent on what business structure you choose, where the business is located, what business you have and so on. The following links will assist you in considering this: 

1. Business registration: Which helps identify which business structure you may need, and the business/ tax registrations you should apply for; and 
2. Finding the licenses you may need for your business: Which helps you identify what licenses, regulations, council approvals and compliance requirements you require.  

Depending on the industry you operate in, you may also need to consult any relevant regulatory bodies in order to obtain further information about any licenses or registrations you need.  

Applying for an Australian Business Number (ABN)  

An ABN is a unique number that is attached to your business and assists in your transactions with the Government and other businesses. You can register for an ABN on the Australian Business Register website. 

Registering for GST and PAYG 

You are required to register for GST if: 

1. your business has a GST turnover of $75,000 or more. The GST turnover = gross income from all businesses – GST;  
2. when you start a new business and expect that your turnover will reach the GST threshold in the first year of operation;  
3. you are a non-profit organisation with a GST turnover of more than $150,000 per year;  
4. you provide taxi or limousine travel, regardless of your GST turnover; and 
5. if you wish to claim fuel tax credits for your business. 

Registration of GST is optional if you do not fit into the above categories. It is likely that in your first year of trading you are not going to be making the $75,000 threshold. 

If you intend to employ other people, you will also have to register for Pay as you Go (PAYG).

We know the level of stress that comes when starting a business and it may seem daunting trying to ensure all these points are covered. At Progressive Legal, our experienced commercial lawyers can guide you through these essential aspects to consider and help your business become completely ready to make an impact in the market. Make an enquiry below to get in touch with our team.

Your Business Plan 

Alongside your consideration of the business essentials, you should create a comprehensive business plan which addresses various questions such as: 

1. what are your business goals (consider goals, objectives, KPI’s etc)?; 
2. what is your unique selling proposition (USP)? What makes you different?  
3. what is your start up budget (consider start up costs such as labour costs, overheads etc)?; 
4. how will you finance your business?; 
5. how will you managing your bookkeeping (consider: income statements, balance sheets, cashflow statements, payroll, expenses etc)? Unless you have experience in this area, it may be best to consider hiring a bookkeeper to oversee this; 
6. what is the market like with your competitors?; 
7. how will you approach branding and marketing your business?; and 
8. how will you build up your digital media presence? 

Protecting your Business  

As your business plan progresses, you should also be mindful of how to protect your business from present and future issues. This includes: 

1. ensuring that your business complies with the relevant Work Health and Safety requirements of your State or Territory; 
2. auditing your Intellectual Property and applying for the relevant registrations where applicable, such as registered trade marks, patents or designs; 
3. complying with your ongoing tax obligations;  
4. having emergency plans; and 
5. applying for relevant insurances such as professional liability, workers compensation, property insurance. 

Brushing up on the law 

Whilst it is not expected of you to have the legal knowledge of a seasoned lawyer, you cannot create a successful business without being across some legal basics. There are various resources online to help you get a grasp on legal issues that businesses experience regularly (our Blog has dozens of these articles).  

Despite the fact you can get a basic understanding of laws yourself, it is still recommended that you seek advice from a lawyer in order to know your obligations relating to various issues that pop up in business such as and not limited to: contracts, employment, intellectual property, privacy and so on. 

There are most likely going to be specific industry laws that relate to your particular industry that you operate in and it’s best to get specialised advice from someone that has done it before many times for others in the same industry as yours.  

Your Employees  

If your business has employees, it is important that your ‘starting a business in Australia’ checklist ensures you are doing everything lawfully with respect to them. Such as ensuring what is needed when an employee is hired (i.e. superannuation and tax requirements), what is required when a contractor is hired and so on.  

Commercial documents  

As your business grows, you will require different types of commercial documents. Some commercial documents you may require include and are not limited to: 

1. terms and conditions; 
2. waiver/disclaimer;  
3. a privacy policy; 
4. trade mark for your business name, logo and tag-line;  
5. deeds of confidentiality to protect confidential information about your business; 
6. IP license agreements; 
7. IP assignments (i.e. where a independent contractor has made copyrightable work for your business – the default is that the contract owns the IP unless they have assigned it to you);  
8. employment contracts;  
9. independent contractor agreements;  
10. referral agreement/affiliate agreement; and 
11. supplier and/ or distribution agreements. 

Other considerations for your ‘starting a business in Australia’ checklist

When creating your checklist, you should also note whether you have sufficiently recorded everything. This includes having a record keeping system for all aspects of your business. In relation to tax and super requirements, the Australian Tax Office has provided guidance on what records you may need based on the size and nature of your business, which you can locate here.  

Key Takeaways

Creating and maintaining a successful business is no easy feat and being across everything is a must to minimise legal issues from potentially arising. Your ‘starting a business in Australia’ checklist will set you in good stead to ensure you are covering all your bases and reducing the possibility of some sort of issue arising.  

If you require any advice in relation to starting a business, or require any commercial documentation make an enquiry below or contact our office at 1800 820 083. 

Why Progressive Legal? 

After helping over 3,500 SMEs over the past 9 years in the areas of Intellectual Property Law, Commercial Law, Dispute Resolution, Corporate Law and Workplace, we’re passionate about what we do and protecting our clients. 

We’re relationship driven, not transactional (unlike the traditional law firm). 

By striving to be affordable, practical and personable – we aim to be your long-term trusted business legal advisor.