There are three main types of business structures in Australia, each carrying their own advantages and disadvantages. These are: operating a business as a sole trader, trust or company. It is important to choose the appropriate business structure for your business from incorporation. This will avoid unnecessary and avoidable tax consequences from the business being set up in the wrong structure.
Adaptations of these main types of business structures exist, such as joint ventures and partnerships. The appropriate business structure is determined by, amongst other things, the type of investment or activity to be carried out by the enterprise, the number of business partners and interested parties involved and funding.
Each type of business structure can also have an impact on the personal exposure and liability of the individuals involved. As well as having different tax implications, reporting requirements and operational costs that require consideration in the set-up phase of any new business.
Our corporate & commercial team assist individuals, new businesses and start-ups, and established small and medium-sized enterprises consider the appropriate business structure to suit their personal and commercial circumstances. Careful consideration of these circumstances ensure the business operates in the right structure going forward and avoids the financial pitfalls which could arise if mistakes are made.