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Business Structure - This article is a part of a series called “Business Start-up in Australia”. The series is meant to provide you with the necessary information to help you start up your business in Australia with as few obstacles as possible. We give you professional advice, useful tips and important governmental websites. Please refer to other links at the bottom of the page to read the rest of the series. Today’s article is going to deal with business structure: Deciding on Your Business Structure Each type of business structure has its own advantages and disadvantages and deciding which type suits your business is a critical step on the process of creating a successful business. Your business structure doesn’t only affect your personal assets but it also affects your taxation obligations. Below are the most common forms of business structure: 1- Sole Trader- AKA Sole Proprietorship: The first thing you need to know about this kind of structure is; as a sole trader, there is no distinction between you and the business. In other words, there is no separate legal existence between the business and its owner. Usually you provide the capital to start the business, you deal with the day-to-day bookkeeping, the systematic recording and organizing of financial transactions in a company, where an accountant will prepare the final end of year accounts and compute the tax due for you. Something worth mentioning here, as a sole trader, you still can employ staff; it doesn’t mean you have to work alone. 2- Partnership: In a partnership type of structure, you with the help of other people start the business and legally share the profits, the risks and the losses according to the terms you all agree upon on your partnership agreement. All of you might share liabilities and profits equally, or some of you may have limited liability. Some of you as partners might not be involved in the day-to-day operations of the business. You also might enjoy favorable tax treatment relative to other types of structure (i.e. corporations). A separate partnership income tax return must be lodged. 3- Trust: A Trust is some form of partnership where the business is run by a third party who has legal control over the business for the purpose of administration and management with a duty to run that business to benefit someone else. A separate trust income tax return must be lodged. 4- Company: A company is considered as a legal entity that is separated from its members (i.e. shareholders). It can accept Limited liability for civil responsibility and taxation. A separate company income tax return must be lodged. Note: you can download the choosing the right business structure booklet from the Australian Taxation Office, ATO, at the following link; https://www.ato.gov.au/ We wish you the best of luck with your venture. Australia-Unwrapped Team To ensure holistic business stratagem review complete series: Part One - Business Startup Australia – Introduction Part Two - Business Startup Australia: Getting Help and Support Part Four - Business Startup Australia: Business Plan Part Five - Business Startup Australia: Obtaining Finance Part Six - Business Startup Australia: Registering Your Business Part Seven - Business Startup Australia: Registering Business Name Part Eight - Business Startup Australia: Understanding Australian Taxes Part Nine - Business Startup Australia: Home-based Business Part Ten - Business Startup Australia: Online Business Part Eleven - Business Startup Australia: Employing People Part Twelve - Business Startup Australia: Workplace Health & Safety Part Thirteen - Business Startup Australia: Online Marketing Part Fourteen - Business Startup Australia: Securing Your Online Business Part Fifteen - Business Startup Australia: Importing Part Sixteen - Business Startup Australia: Exportation Main Image Source : Pixabay