When you’re starting a business there are certain things you really need to understand.
1. Your business structure
The first thing you really need to understand is the structure you’re going to start. It can be partnership, trust, sole trader or it could be a company.
This will dictate how your business is run in the future. So you should get it right. Put some thinking around it.
2. Australian Business Number (ABN) Registration
When you start a business there are certain regulations. Everybody who transacts business in Australia should have an ABN.
Now, what does an ABN mean? Well, an ABN is your way of being able to do business.
You can do business without an ABN. But what that means is that the person you give the bill to Is legally responsible to take back or withhold from you nearly 50% of the invoice.
So, my mate Pete gives me an invoice for $100 and then I give him back $50, and I’ve paid $50 to the Tax Department on his behalf. So, you really need to have your ABN sorted out.
3. GST (Goods and Services Tax) Registration
The other thing you need to decide is whether or not to register for GST.
These are some of the registrations that you should have a look at first, before you move ahead.
The structure you choose when starting a business will determine the sort of taxes that you’re going to pay.
Now, in Australia, we’re lucky enough not to have double taxation.
However, it comes down to timing. Companies are taxed to the flat rate. Individuals, partnerships, trusts can be taxed way different rates from a company rate.
So, one of the key things you really should understand is about your taxes and how that’s going to affect your business and your family going forward, before you start.
4. Your obligations when hiring people
One of the greatest joys is business is growing, particularly when you can help other people and other families. And that comes down to hiring people.
Now, sometimes you get it right, but sometimes you get it wrong. Sometimes you mean to get it right but you get it wrong.
There are certain things you can and can’t do when you’re hiring people. And there are certain things that you should and shouldn’t do when hiring people.
So, make sure you understand what your obligations are with regard to hiring people and how the workplace needs to be set out, the wages that you need to pay them, the holidays that you need to pay them, the leave entitlements that they’re supposed to have.
Get really good, sharp on these things. Because if you get these right, you end up with having a place where people really want to come to work.