There are many reasons to starting a business in Australia. As long as you follow the rights steps for setting up your business, then you will set yourself up for success. There are three main types of businesses you can start in Australia and certain benefits to each. I have seen many new business fail miserably, and I have seen some start-up Aussie businesses become very successful. The thing that the successful Australian businesses have in common is that the founders were passionate and, therefore, motivated. Don’t start a business out of the sole desire to make money. Donald Trump and Warren Buffet have both said do what you love and the money will follow. If you love to cook, then open a restaurant. If you’re a lawyer, then don’t open an online store. Got it? Get it? Good!
First, think long and hard about what you love to do. Later on you can figure out how to make money from the one thing you are truly passionate about. If you’re an artist, then paint or practice whatever medium of self expression you love. If you’re smart enough to follow your dreams, then you will be smart enough to figure out how to make money from it.
A good place start looking around for business ideas is in your own house. Go ahead, look around the room you’re in and find an area that has a problem that needs to be fixed or causes irritation or frustration. That unorganized stack of business cards in the corner, CD’s everywhere (itunes, ipod, etc.), dirty window, shelves that are too high, pile of laundry in the middle of the floor, etc. Everything has potential for the next great thing.
Next, you will want to decide which type of business to open in Australia. You can chose from sole trader, partnership, and company. These are the three ways to start up a business in Australia and here are the tax benefits of each.
A sole trader is the least expensive and easiest business to start in Australia. A “sole trader” status business is not a separate entity for tax purposes. Therefore, you are taxed at the same rate as your personal income tax. This may be good or bad, depending on how much you earn with your business. In Australia the business tax is a flat rate of 30%, while personal income tax is a progressive rate system. The highest rate for personal income tax in Australia is 45%. If you would be in a higher tax bracket, then it makes sense to form your own company, but if you don’t plan on making much money the first year then register your business as a sole trader so you pay less taxes.