Australia, the land down under has emerged as one of the most exciting places for entrepreneurs and small businesses to launch a thriving business owing to the supportive business landscape. Businesses in Australia are expected to register an impressive 9.45% CAGR between 2022 and 2029; the country is currently the 14th-largest economy by nominal GDP.  

There were around 2,662,998 actively trading businesses operating in Australia in 2024, a 2.8% growth against the previous year. Are you looking to transition your idea into a thriving business in Australia? If yes, this blog is just for you.  

In this article, we will cover the different business structures and all the aspects of business registration in Australia including process, costs, and why it is critical to register a domain name for your business in today’s day and age.  

Let’s start by understanding the most popular types of business structures in Australia.  

Different Types of Business Structures in Australia

While registering a company in Australia, you will need to choose a suitable business structure. This decision will influence how you are taxed, the legal obligations, and the degree of liability you can carry as a business owner.  

Here are some of the most common types of business structures in Australia.  

  • Sole Trader

A sole trader is one of the most popular and simplest forms of small business structures in Australia, allowing business owners to register with minimal paperwork. A sole trader is the sole owner and operator of the business and is primarily responsible for all aspects of the business including legal obligations and debt.  

A sole trader also has complete control over decision-making, making it one of the most appealing and straightforward business structures for individuals in Australia.  

Pros: 

  • Minimal paperwork and costs 
  • Sole traders can claim around 50% discount on capital gains tax 
  • You can change the business structure as your business scales 

Cons: 

  • Individuals can incur personal liability for business obligations and debts 
  • Creditors can claim your assets including your car and home if the business fails 

  • Partnership

Unlike a sole trader wherein a business is operated by a single business owner, a business with a partnership structure involves two or more people who share profits and losses between themselves. There are three main types of business partnerships including a general partnership (GP), limited partnership (LP), and incorporated limited partnership (ILP). 

Business owners need to understand the partnership laws across different territories and states since they differ from each other.  

Pros: 

  • The responsibilities including decision-making, work distribution, and finances are shared minimising individual burden.  
  • Every partner brings something different to the table. 
  • Setting up a partnership is straightforward and affordable.  

Cons: 

  • Every partner is personally liable for the different obligations and debts.  
  • There could be internal conflicts and differences in opinion regarding work ethics, how the business must run, etc.  
  • Profits are distributed.  

  • Company

The company business structure is complex compared to how a partnership and sole trader business is set up since it is technically a different legal entity altogether. The company business structure falls under the purview of the Australian Securities and Investments Commission (ASIC) – the regulating body that oversees compliance and other aspects of the business.  

Additionally, companies are subject to different tax compliance obligations and are required to pay a flat 50% corporate tax on profits. Further, a company must also submit an annual company tax return and are required to audit their financial statements by a registered auditor annually.  

Pros: 

  • The liability of a shareholder is only limited to their investment, making them free from personal liabilities.  
  • Good business structure alternative for high-risk businesses that typically require a robust asset protection strategy.  

Cons: 

  • A company in Australia cannot claim the 50% concessions on capital gains tax.  
  • Complex and lengthy tax compliance obligations 

  • Trust

The operating and business structure of a trust differs from that of a company since a trust isn’t a legal entity. A trust business structure is primarily a legal arrangement in which the assets are held by the trustee for the beneficiaries.  

The different types of trusts in Australia include fixed, unit, discretionary, hybrid, and fixed; all different from each other in terms of legal obligations, liabilities, complexities, and costs.  

Pros: 

  • Offers asset protection for all beneficiaries even if the trustees are sued.  
  • Shareholders are likely to benefit from the company’s limited liability.  

Cons:

  • The trust is required to distribute the profits to its beneficiaries.  
  • A trust isn’t an ideal option for scaling businesses that typically reinvest profits into the business again since a trust is required to pay the highest marginal tax rate at around 45%.  

Things to Prepare Before You Register a Company in Australia

Now that we know about the different business structures, here are a few things you should know before registering a company in Australia.  

  • Pick a Unique Company Name

Your company’s name must be unique and not identical to an existing registered company. You can check the availability of your company’s name on the Australian Securities and Investments Commission’s (ASIC) website. You must also ensure that the name adheres to the trademark and copyright laws to avoid legal issues.  

  • Roles and Responsibilities

Define the roles and responsibilities of all the stakeholders in the business including shareholders, secretaries, directors, etc and ensure they are compliant with the Corporations Act 2001. 

  • Understand Australian Company Numbers (ACNs) 

The ASIC issues a unique company number to all business entities registered in Australia that is primarily used across all the official company documentation. The ACN is added to all the legal documents, invoices, and company’s stationery.  

Registering a Company in Australia: Process

1. Company Name

The first step is to check and ensure that your business name is unique and not similar to a registered business entity. Use ASIC’s business name availability tool.  

2. Company Registration Fee

The registration fee for a company name is around AUD 44 for one year and AUD 102 for three years. The renewal fee is similar to the registration fee.  

3. Time Taken to Register a Company in Australia

Although it takes 2-3 days for your applications to get approved, applicants must pay the registration fee within 10 days after their application is approved.  

Scan through all the information to ensure you have entered all the details including office address, director information, company structure, etc.  

4. Register for Taxes

All businesses must apply for an Australian Business Number (ABN) and Goods and Service Tax (GST) if the annual turnover is more than AUD 75,000.  

Take Your Australian Business Online by Registering a Domain Name

While registering your company is important, it is equally crucial to register a domain name to ensure your company has a strong online presence. Pick a domain name that is identical to your company’s name and try incorporating the relevant keywords. You can use Crazy Domain’s domain availability tool to check whether the desired domain is available.  

Now, pick the right domain extension that resonates with your business. Some of the most commonly picked domain extensions include .com.au and .org.au. Register your domain name through a reputed hosting provider to launch your website.  

Final Words

While business registration in Australia is pretty simple, there are a few key steps one can miss during the registration process. The costs associated with company registration is affordable and predominantly varies on several factors, type of company, nature of company, and more.  

We hope this article serves as a guiding light as you proceed to register your company in Australia.  

How Much Does It Cost to Register a Company in Australia – FAQ’s

 

What is an Australian Business Number (ABN) and how much does it cost?

An Australian Business Number (ABN) is a unique 11-digit number for registered businesses that is primarily used in official and legal documents to identify a company. You can apply for an ABN for free through the Australian Business Register.   

Why is it important to be compliant with ASIC?

Complying with ASIC ensures your business is legally registered and credible.  

Do company registrations need to be renewed?

All the company registrations need to be renewed annually in Australia.  

Do I apply for ABN or ACN first?

You must apply for an ACN first since you need it while applying for an ABN.  

Can I run a business without an ABN?

No, all businesses registered in Australia must have an ABN.  

 What are the main benefits of registering my business?

Some of the key benefits of registering your businesses include legal protection, access to tax concessions, and lucrative funding opportunities.