How to know if you are ready to start a business
If you have an idea or a hobby that you want to turn into a business, or you are passionate about owning your own business, you can use this resource to see if you are ready:
You can always contact the Business and Regions Team who are happy to help. Talk through your idea and what your next steps might be:
There are many ways to get started in business
Consider if there is an option that suits you or your business idea best. Options include registering as a sole trader, partnership, or trust. You can also establish a company or incorporated association. See below for more detailed information.
Incorporated Associations
If you are a community group or not for profit that is looking to become an incorporated association, access this useful information to begin to understand what you need in order to do so effectively:
Ready to take the first steps to starting your business
Starting a business is exciting. You can set yourself up for success by making use of the tools, information and help available. This will help your business and your staff stay safe and thrive. It may take some time to understand it all, so be patient and ask for help when you need it.
To get you started, here is some information for you to consider as you are setting up your business.
As legislation and requirements are often changing, we aim to point you in the right direction and to the right information. It is always important to check that the information provided is right for you and your business, as every business is different and unique.
Learn more about
Deciding how to structure your business is important as it will influence what registrations you need, and how you manage reportable income, assets and tax.
There are a few options to consider, with a more detailed summary on the ASIC website.
Be sure you understand the details around each option.
To start, here is a quick summary:
Sole trader: you are a sole owner of the business. This can be good for individuals running a small business.
Partnership: you and your business partners own the business together. If you are in a family partnership, two or more owners are related. This can be good for a few family members running a small business.
Company: is more complex to set up and more expensive to run but it does separate the business from you and your assets. This can be good for larger companies with a number of owners who want to keep things separate.
Trusts: a business is held and controlled by a trustee for the benefit of others. This can be a more complex structure but good for charities or complex family businesses.
Cooperatives: a cooperative is a legal entity made up of five or more people. It's jointly owned and democratically controlled by its members. In the Northern Territory (NT), cooperatives are administered by Licensing NT under the Cooperatives National Law. Find out more about registering a cooperative.
Helpful Tip
Unsure what will suit you? The Australian Government has a handy and easy to use decision making tool to assist you: Business Structure - Business Registration Service
If you are unsure or want to check you have made the right decision, you can seek the help of a trusted advisor such as an accountant, who can help you figure out which option will suit you both short term and long term.
Use the Adviser finder to find someone near you
Once you have decided on the right business structure for you, you may need to register your business name.
You will need to register your business name if you are using a trading name that is any different to your own personal name, for example: Jane Doe Advisory.
This is an exciting step towards making your business a reality.
If you decide to set up a company you will also need to register your company. You can always seek the help of an accountant to assist you as this is a more involved and complicated process.
To register your business name or company, you can apply for an Australian Company Number (ACN) from the Australian Securities and Investment Commission (ASIC).
ASIC does not register trusts, partnerships or joint ventures.
Please check with a trusted adviser to make sure you have the right registrations in place, as every business is different.
Depending on what company structure you decide on and what type of business you run, you may need additional registrations.
You can find out more detailed information on how to here:
This helpful tool will walk you through a series of questions to help you understand what registrations you need:
Work out your business registrations
Helpful Tip
If you are confused at any time you can reach out to our Small Business Champions.
An ABN identifies your business to others when you are invoicing and purchasing goods and services for your business.
You can trade without an ABN, but that is considered to be more of a hobby.
Be aware, if you do not have an ABN and you are selling to other businesses, they must withhold 47% of payments they make to you for tax purposes. Read more about this here.
Having an ABN makes running your business easier, particularly if you have to report your income for tax purposes (see information about GST below).
Applying for an ABN is free and quick if you have the information you need. To register you will have to provide:
- Identified business structure
- Proof of identity
- Details of your business activities
- Details of any business partners, directors or trustees
For a full and detailed list of information you may need to provide, see this Australian Government website.
Helpful Tip
The Australian Government has plenty of further information about ABNs. This Video is helpful in understanding ABNs further.
Business tax can be tricky to navigate and a bit confusing when you first start.
Having the right support through a trusted accountant can be helpful in assisting you meet your tax obligations, and also save taxes through concessions and deductions.
There are particular things you may need to have in place, including:
- Having a tax file number for your business
- Registering for 'pay as you go' withholding, which is tax you withhold and pay on behalf of any employees
- Understanding fringe benefits tax
Make sure you are registered to meet these regulations. For more information see this helpful website by the Australian Taxation Office (ATO).
You may also qualify for concessions and deductions which may reduce your payable tax. See this helpful website for more information. As every business is different and you will need to consider what is right for you.
Helpful Tip
The ATO has developed a Tax Time toolkit for small businesses to help learn and figure out what is relevant to them. We encourage you to access these resources.
As a business in Australia, you will need to pay a tax called GST (Goods and Services Tax) on the goods or services you sell if you sell more than $75,000 in a 12-month period.
GST is a tax of 10% of most sold goods and services. There are some products that GST free and you can find out more here.
When you are pricing your goods and services you should include 10% of GST in the price, as this is the money you collect and pay to the Australian Government.
If you are unsure or want to double check how to include GST, you can use this calculator to figure out how much GST to include in a sale price.
You will have to provide tax invoices for goods sold.
You can claim credits for GST on the cost of goods and services you buy for your business, meaning this is the 10% GST you pay to other businesses.
Sometimes businesses provide quotes which includes (inclusive of) or excludes (exclusive of) GST because of these credits. Make sure you understand how this works and the impact it will have on the GST you have to pay.
Paying the GST you collect to the Australian Government is done regularly via a Business Activity Statement (BAS) which you can lodge online.
Most businesses lodge and pay BAS every 3 months. You can use accounting software to keep track of GST and GST credits to make this process easier.
Helpful Tip
As you collect it, you can put the GST you will have to pay in a separate bank account.
This can help avoid financial stress at BAS lodgement. There are helpful tips on this Australian Government website.
Australian and state consumer laws are there to protect you, your business and your customers when it comes to selling and buying products.
If you are selling goods you need to comply with these laws and industry codes of practice.
In the Northern Territory we have the NT Consumer Affairs and Fair Trading Act 1990.
The Australian Competition and Consumer Commission (ACCC) has a publication to help you understand the Competition and Consumer Act 2010 and the Australian Consumer Law (ACL).
The Australian Government outlines in more detail what it means for businesses in their helpful website which will tell you more about the laws relevant to your business, how to display pricing, product rules and standards, codes of conduct and collective bargaining.
A business plan can set you up for success and help avoid losses or mistakes. Business plans can take many forms, but two that are common:
A shorter plan to help evaluate a business idea, set goals and keep your business on track. You can use the Australian Government tool to help you develop a plan
A detailed business plan which can be used to seek financial assistance or develop a more detailed plan for your business. You can use the Australian Government template to make your own.
Helpful Tip
Reviewing your plan regularly will help you stay on track and identify any areas of your business where you can improve.
You do not need a business plan to start your business, but it can be helpful.
As a business owner, hiring staff can be a great way to make your business sustainable and profitable, but there are also obligations that you will have to make sure you are paying your staff correctly and looking out for their wellbeing.
Luckily, you aren’t alone. There is lots of information and tools to help you understand and navigate this.
The most important source of information is through The Fair Work Ombudsman, so if you do not know where to start, this is a great place to find information, tools and templates.
They can also help you with any questions, concerns or if you feel like you have made a mistake through their online tool, or call centre.
Hiring staff:
Unless you have your own employment agreement, you will hire staff under a legislated Award, which will tell you what level to pay your staff, what leave they might accrue and what entitlements they might qualify for. The Award you will use will depend on what industry your business operates under. You can find which award applies to you with this 3 step form.
You can also use this Pay and Controls Tool to help you set up employees pay and leave accurately.
Helpful Tip
Use this hiring employees checklist to ensure you are meeting your obligations as a business owner.
Useful resources:
Having the right licences and permits for your business will ensure you are complying with Australian and Northern Territory requirements.
As the licence requirements are specific to each industry and business, you can complete this 5 step questionnaire provided by the Australian Business License and Information Service, which will produce an individualised report of what you need.
Here you can also access information about fees, periods of cover, renewals, how to apply and where to find more information.
The NT also has specific requirements regarding the zoning of business operations:
Helpful Tip
The Territory Business Centre are here to assist you to navigate these processes.
Having the right insurance reduces your risk and protects your business.
Before you start your business, having an understanding of what insurance you might need will help inform you of any risk associated with running your business. It will also help you plan for financial costs associated and think about protecting your assets and income.
The insurance you may get will depend on your business and industry.
There may be compulsory insurances such as:
- Workers compensation insurance if you employ staff
- Motor vehicle insurance
- Public Liability Insurance
Other insurances that may be worth considering are:
- Cyber insurance
- Management liability insurance
- Corporate travel insurance
- Professional indemnity insurance
- Asset insurance, or business pack
As an owner, also make sure you understand your personal accident and illness insurance as you may require alternative policies than what has insured you in the past.
Helpful Tip
Registered insurance brokers can help you find and source the right insurance for your business. You can find a register of insurance brokers here.
There are Northern Territory Government services that are free and here to help
Australian Government information
If you need more help or information these Australian Government business services go into more detail around what you need to know about starting a business: