How to Start a Business in Australia
Starting your own business in Australia is an exciting and lucrative prospect, but it can also be overwhelming if you’re unfamiliar with the rules and regulations governing these ventures.
To help you out, we’ve written this guide to help you on your way to starting a business in Australia, whether you’re planning on starting your own business in the near future or simply looking to brush up on current laws that may affect your new venture. You can also seek help from professional attorney.
Step 1 – Finding an idea
First, you’ll need an idea. This is tough, not because you can’t think of ideas, but because there are so many! The best way to find one is simply by thinking about what interests you and what inspires you.
If you’re starting a business for retirement money, that might work; if not, try looking at other people’s success stories—maybe one will give you an idea for your own path. Also look within yourself: What do you have a knack for? What do other people come to you for help with? Answering those questions can lead to valuable ideas as well.
Step 2 – Validate Your Idea
Once you’ve identified an opportunity, your first step is validating that it’s a viable idea and most importantly that it actually solves your customers’ problem. To validate your idea, you need to get out of your own head and talk with as many customers as possible.
Talking with existing and potential customers gives you insights into what problems they have, why they have them, and how much of an impact solving them would make on their lives. At any stage of business development, talking with these people is crucial.
However, when validating ideas, it’s even more important since invalidated ideas can consume resources and lead you down dead-ends.
Step 3 – Form a Company
Once you’ve got your business idea down on paper, you can begin taking some actions. The first of these is usually forming a company or partnership and figuring out what type of commercial structure it will take.
Commercial law varies by state, so talk to an accountant or attorney specializing in commercial law about legal requirements and taxes for your company’s particular situation. While forming a business can be complex, there are plenty of resources out there that can help guide you through specific steps and make sure you’re doing everything correctly.
Step 4 – Register as Self-Employed
The first step towards starting your own business is registering as self-employed. Depending on what your business will be, you may have to register with more than one agency: Generally, businesses that provide or prepare food (commercial kitchens), care for children (childcare centers) or collect and dispose of waste materials must register with local government agencies.
If your idea is simpler—maybe you just want to start running a cashier’s booth at night at your local mall. You’ll probably only need to register as self-employed and with Australian Commercial Law for companies. Before hiring employees, all businesses should consider getting professional help from an accountant, lawyer or business consultant who can review their commercial structure and protect them from liabilities.
Step 5 – Set Up Bank Accounts
Make sure you have a business bank account. Before starting any business, you need an Australian Business Number (ABN) and tax file number. They’re basically your license to operate legally and file taxes as an Australian business.
You also need at least one other kind of bank account for your own personal funds—one that your company can’t access directly, which is usually referred to as operating capital. A separate bank account helps limit liability should something go wrong with your company, and makes it easier for you keep track of how much money is coming in and going out for bookkeeping purposes.
Step 6 – Get Insurance
To start any business, you’ll need insurance coverage. While some forms of insurance are optional, like health or auto, when it comes to starting your own business, having proper commercial law and liability protection is absolutely crucial. What happens if someone gets hurt because of your product? What happens if your product injures someone? These risks can add up quickly—especially for startups with limited cash flow.
Protect yourself by figuring out what commercial law and liability protection you should have before you launch. If there’s an area where you can save money without reducing your coverage—like lowering unnecessary fees or cutting back on excess products—that’s better than spending money unnecessarily.
Step 7 – Register for Tax File Number (TFN) and Business Number (BN)
Australian businesses are subject to tax and must, therefore, be registered for tax. To do so, you’ll need a Tax File Number (TFN) from your local Australian Taxation Office. Then you can register for a Business Number (BN).
Both of these numbers are crucial in starting an Australian business and allow you to legally operate as one.
Step 8 – Get an ABN & GST/VAT Registration
Australian business laws are different from American business laws. In fact, they’re so different that if you plan on starting your company Down Under, it would be worth your while to brush up on commercial law or hire an accountant or lawyer who has experience with Australian business laws.
It might seem like overkill since you only have one employee and barely any revenue, but doing things by-the-book is important when you want to start your own business down under.
Setting up an ABN (Australian Business Number) and GST/VAT (Goods and Services Tax / Value Added Tax) registration are two essential steps before launching anything more than a hobby-business venture.
Step 9 – Marketing Your Business
Starting your own business is risky, so be sure you have a safety net. If things don’t go according to plan, it’s okay just ask for help and reassess. While many business owners try to go it alone, asking for help from peers, advisors and mentors can turn disastrous situations into opportunities.
When you do ask for help though, make sure you’re open and honest about your situation; people will want to help you succeed! Good luck!
Step 10 – Ask for Help, And Good Luck!
Be confident, but ask people for help. Maybe you have an amazing idea that seems totally doable, but you don’t know how to get started? Reach out! Most businesses were started by two or more people; even if you’re not ready for another partner yet, reach out and find someone who knows about your industry and can give some advice.
You never know what kind of contacts or resources might come along with that advice. The more people you talk to, and the more who say Yes! Let’s do it! the easier it is going to be when it comes time to actually start your business.
