Starting a business can be overwhelming. We have compiled an overview to assist with some of the key considerations in that regard. Coulter Roache can assist you with many of the key components of starting a business, and when we are unable to assist you directly we can point you in the right direction.
Consider the below steps when planning and commencing your business. If you are already operating a business, you should ensure you are compliant and protected.
- Write a Business Plan
Writing a business plan is an integral and essential step. A relevant and detailed business plan will you and facilitate you to make decisions in line with your purposes and goals. Your business plan will change and evolve with your business, but it is recommended that you engage in this exercise at the outset.
- Pick the Structure that Works for You
It is important to give consideration to which type of entity is right for you and your business. The different structures that may be used to operate a business include:
(a) A Sole Trader;
(b) A Partnership;
(c) A Company; or
(d) A Trust.
When considering which entity is appropriate for you, consideration should be given to:
(a) Your asset protection needs;
(b) The predicted revenues and profits of your business;
(c) The taxation implications for each entity;
(d) The future endeavors of the Business.
For a further discussion on the different business structures that may be utilised see Coulter Roache’s previous article “Picking the Structure that is Right for You and Your Business”
If you need assistance determining which entity is the correct one for you and your personal circumstances Coulter Roache can assist.
- Apply for an ABN
No matter the structure of your Business, an ABN is required. Applying for an ABN is simple and can be done online through the Australian Business Register. Alternatively, your accountant can assist you.
- Register for GST
You, your company, trust or partnership will be required to register for GST if your business has a GST turnover of $75,000 or more. GST turnover is defined as the gross income minus GST.
Registering for GST can also be done online through the ATO website, or alternatively your accountant can assist you.
- Register your Business Name
Once you have an ABN you can apply to register your Business Name online through the ASIC website.
If you are trading under a different name to the operating entity, a Business Name must be registered.
- Establishing Your Financials
Consider how your new business will be financed. A mortgage broker or financial institution is an appropriate place to start. Depending on your business, traditional funders may not be an option. You may need to consider private investors, or perhaps you can fund it yourself. Discuss the financial viability and funding options with your accountant.
If you are operating as a Sole Trader, it is recommended that you open a separate bank account for your business. This will simplify your accounts and help you managed cash flow.
If you operate as a company, trust or partnership, a separate bank account should be opened in the name of the respective entity.
- Protect Yourself
It is essential that you are as protected as possible when you establish and operate your Business. Some of the key considerations are outlined below:
(a) Terms and Conditions
It is important to set out the terms and conditions of the supply of your goods or services. A robust terms and conditions document will set out your obligations, your customers or clients obligations, limit your liability (to the extent permitted by law), set out the payment terms, and any other essential provisions relevant to the supply of your products.
Depending on the nature of your Business, different privacy laws and regulations may be applicable.
These laws and regulations include:
(i) The Privacy Act 1988 (Cth);
(ii) The Australian Privacy Principles;
(iii) Notifiable Date Breaches; and
(iv) General Data Protection Regulation.
(c) Trade Marks and Intellectual Property
Consideration should be given as to whether your brand requires trade mark protection. A particular word or image (or each of these) can be registered as a trade mark. Registering a trademark offers your brand protection, by demonstrating your ownership, and allowing you, or your respective entity, to exclusively use the word or image.
Registering a trade mark requires an application to IP Australia. IP Australia will examine the mark and determine if they have any objections to the proposed trade mark. After the trade mark has been examined by IP Australia (and providing there are no objections), then the proposed trade mark will be open to be opposed by other parties for two (2) months.
Unlike many other countries, you do not necessarily have to have started using the mark prior to applying for registration.
Consideration should paid to all aspects of intellectual property including copyright, designs and patents.
Insurance is integral to ensure you are adequately protected in your business venture.
We recommend you discuss your business insurance requirements with an insurance broker.
- Business Premises
Depending on your business, you may be entering into a commercial or retail lease for your business premises. It is recommended that you have a lease reviewed prior to signing. Generally these leases are for terms of five (5) years or more, so it is important you understand your obligations and rights prior to entering into a lease.
If you require advice or further information in relation to any of the matters discussed in this article, please contact our Corporate & Commercial team on 03 5273 5263.