Starting a Business in Australia
Business structure comparison, ABN and GST registration, tax and accounting, insurance and licences, and a due diligence checklist for buying an existing business — a practical guide for newcomers to Australia.
1. Business structure
Your structure affects tax, liability, and registration costs. Choose carefully at the start.
An individual business. Easiest and cheapest to register and run, but business debts can affect personal assets.
A business of two or more partners. Requires a partnership agreement; partners share joint and several liability.
A separate legal entity registered with ASIC. Offers asset protection but adds fees and company tax obligations.
A trust structure. Used for family businesses or asset protection; setup and operation need professional advice.
2. Registration
Register ABN, Business Name, GST, and TFN in sequence. Most can be done free or cheaply through official government sites.
ABN (Australian Business Number)
An 11-digit business identifier. Apply free at abr.business.gov.au — you are only entitled to one if you are actually carrying on an enterprise. It is the starting point for most Australian business activity, and you cannot charge GST on invoices without one.
Business Name registration
If you trade under a name other than your own legal name, you must register a Business Name with ASIC — $47 for 1 year or $108 for 3 years (FY2026-27; ASIC fees are indexed to CPI every 1 July). The name is linked to your ABN. Source: ASIC business names fee schedule (checked 2026-07)
GST (Goods and Services Tax)
Registration is mandatory within 21 days once annual GST turnover reaches AUD 75,000 (150,000 for non-profits). Taxi and ride-share drivers must register before their first trip regardless of turnover. Once registered, you lodge a BAS quarterly or monthly. Source: ATO 'Registering for GST' (checked 2026-07)
Business TFN
Sole Traders use their personal TFN, but Partnerships, Companies, and Trusts each need a separate business TFN. You can apply when registering an ABN.
3. Tax and accounting
Bookkeeping
Accurate bookkeeping is the foundation of running a business. The following accounting software is most widely used in Australia.
- Xero — cloud-based, market leader in Australia, with automated BAS generation.
- MYOB — Australian-grown software available in desktop and cloud versions.
- QuickBooks Online — strong global share with an intuitive interface.
BAS (Business Activity Statement)
GST registrants must lodge a quarterly or monthly BAS. It includes GST collected, GST paid, and PAYG withholding. Late lodgement attracts ATO penalties.
4. Insurance and licences
Key business insurance
- Public Liability — general liability insurance, recommended for almost any business.
- Professional Indemnity — essential for consulting and professional services.
- Workers Compensation — mandatory under state law from your first employee.
- Property and Stock — covers fire and theft for retail premises and inventory.
5. Buying an existing business
Buying a business that is already trading means you start with customers, revenue, staff and equipment in place — but hidden debts, overpriced goodwill and lease disputes can come with it. For small businesses like cafes, restaurants, cleaning rounds and retail shops, due diligence is what separates a good buy from an expensive mistake. The checklist below is based on the official 'Buy an existing business' guide on business.gov.au (checked 2026-07).
Due diligence checklist
- Verify the financials — cross-check the last 3 years of financial statements, BAS lodgements and sales records against each other, and have an accountant review them independently. In cash-heavy businesses, never take claims of 'off the books' income at face value.
- ABN and GST status — use ABN Lookup (abr.business.gov.au, free) to confirm the seller's ABN is valid and check their GST registration.
- Security interests — search the PPSR (ppsr.gov.au) for $2 per search to see whether equipment, vehicles or stock have security interests registered against them (checked 2026-07). Assets under finance can come with the seller's debt attached.
- Licences and permits — confirm the licences the business needs are current and can be transferred to a new owner (search by industry and location on ABLIS).
- Contracts — review the lease, supplier agreements and any franchise agreement for transfer conditions and remaining terms.
- Debts and disputes — check for outstanding debts, ongoing legal action and employee entitlement liabilities such as accrued annual leave.
- Revenue concentration — if sales depend on a few key customers or on the seller's personal relationships and skills, expect attrition after the handover.
Source: business.gov.au 'Buy an existing business' (checked 2026-07)
What to check in the contract
6. Useful links
- business.gov.au(opens in a new window)
business.gov.au — official Australian government guide for starting and running a business.
- Australian Business Register(opens in a new window)
Australian Business Register — ABN and Business Name registration.
- ASIC Connect(opens in a new window)
ASIC Connect — company and Business Name registration and management.
- (opens in a new window)
Advanced Business Guide — Registration, GST/BAS, Employment, Tax, Licences and Visas in Practice
Registering your business is only the start date; the real work begins after that. This guide covers the points migrants most often get stuck on: Director ID and choosing a structure, how GST/BAS reporting works, the new Payday Super rules for employees from July 2026, tax deductions, industry-specific licences, and whether your visa lets you run a business. Tax rates, fees and deadlines change every year, and procedures vary by state and by visa, so always confirm the final details with official bodies such as the ABR, ATO, ASIC, Fair Work and your state government.
Registration and Structure in Depth — Director ID, ABN Entitlement, Restructuring
Getting a Director ID is mandatory (Director Identification Number)
To become a director of a company (Pty Ltd), you must obtain a free Director ID before you are appointed. You apply through the Australian Business Registry Services (ABRS) using the myID app, receive a 15-digit lifetime number, and it usually takes about 15 minutes. Anyone who becomes a director for the first time on or after 5 April 2022 must have it before appointment, and failing to obtain one breaches the Corporations Act, exposing you to a civil penalty of up to 5,000 penalty units (roughly 1.65 million dollars at the current penalty unit value) as well as criminal sanctions. Directors living outside Australia have to follow a separate paper application process instead of the app, so allow plenty of time.
An ABN is not automatic — entitlement and cancellation
An ABN is not a number you simply receive by filing an application; you are only entitled to one if you are actually carrying on an enterprise, and a hobby or a one-off activity does not qualify. The ATO will cancel dormant ABNs on its own initiative where there is no ongoing turnover, BAS or income reporting, so you may need to reactivate one when you resume after a break. Gig work such as Uber or delivery also requires an ABN once you provide labour and receive payment for it. If you close your business, don't leave an ABN you're no longer entitled to sitting idle — lodge a cancellation with the ABR.