The types of business registrations you will require will depend on a number of issues including your type of business structure, your anticipated turnover and whether you also intend to employ staff.
No matter whether you are a sole trader, company, trust or partnership you need an ‘Australian Business Number’ or ABN. If you plan to operate through a Company structure you need to register your Company first through ASIC and then get an Australian Company Number or ACN before you get your ABN. Your ABN is a unique, 11 digit number that basically lets you operate in the GST tax system. You need your ABN to register for GST, PAYG Withholding and other taxes including FBT.
Without an ABN you cannot claim the GST credits on your business expenses. You also need to quote your ABN on your invoices to avoid having other businesses withhold 46.5% of any payments they make to you. An ABN also gives you access to an AUSkey so you can transact online with Government agencies.
The second key registration for a new business is a Tax File Number or TFN. If you are a sole trader operating in your own name or a business name you will use your personal TFN that you already have. Other entities will need to register for a TFN and you can do this at the same time as you apply for your ABN.
The third key registration for a new business is GST and you must register for GST if you run a business and your annual turnover is going to be $75,000 or more. If you are a non-profit organisation the turnover threshold is $150,000. It is your responsibility to register if your turnover is going to exceed the relevant threshold and you have 21 days to register when you reach the threshold. You must also register for GST if you want to claim fuel tax credits for your business or provide taxi or limousine travel. By registering for GST you then need to lodge Business Activity Statements either monthly or quarterly. If your annual turnover is under the threshold then registration for GST is optional. You can't charge GST or claim the GST credits on your business purchases if you don’t register for GST. We can assist you with the process and you can apply to register for GST when you register for your ABN.
If you have employees there are additional registrations including Pay as You Go Withholding or PAYG that lets you withhold tax from your employee’s wages and suppliers who don’t quote an ABN on their invoices.
Finally, there are other registrations you may need to consider including trademarks and patents, payroll tax, domain names and Fringe Benefits Tax.
If you’re looking to start your own business we urge you to consult with us regarding the various registration requirements. We have built a reputation as business start-up specialists and offer you a free consultation to discuss your set up needs.