Develop your business structure
Business structures impact on who can make important decisions, tax advantages and disadvantages, how profits and losses are shared, legal obligations and costs. Use our step-by-step guide to help you decide. You can change your structure as your business changes so pick what's best for you now.
Three most popular business structures
For new businesses, the three most popular business structures are sole trader, partnership and company. The structure identifies your operation as a trading business.
Knowing the differences between these structures and choosing what's best for your business can put you in the most favorable tax and legal position.
A sole trader is a simple business structure that gives you, the owner, all the decision making power. You can also hire staff if you want to. Business losses can be written off your PAYG tax from another job
A partnership is formed when two or more people (up to 20) go into business together. Partnerships can either be general or limited.
A company has members (shareholders) who own the company, and directors who run it. However, if you're an independent contractor you can set up a 'one person company' with a sole director and member. Companies can also be listed as public companies, meaning the public can buy shares to invest in the company.