Business Structure Sunshine Coast & North Lakes

Understanding the advantages and disadvantages of a certain business structure on the Sunshine Coast is key to starting your new business off right. Each business structure offers a different opportunity to undertake certain activities such as raising capital. It also impacts the asset/risk protection of directors, the tax implications and other business obligations. It can be difficult to navigate the different benefits of each business structure. This is why we choose to offer business structuring on the Sunshine Coast, to make it easier for you to set yourself up on the right foot.

Please visit our pages for business structure in Brisbane, Redcliffe and North Lakes.

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The most common types of business structures in Australia are:

When we talk about a business structure, we are referring to the legal structure of an organisation. There are four main types of business structures in Australia. These are:

  • Sole trader
  • Company
  • Partnership
  • Trust

In the next section on this page, we explain each of these business structures.

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Choosing the right Business Structure

Choosing the right avenue can be difficult; however, you are not tied down to one and you can always change your business structure as you expand and grow. Each of these business structures may affect certain costs, your assets and the tax that you are liable to pay. Let us take a quick look at what each of these business structures means.

Sole Trader

When you become a sole trader, you are legally responsible for everything associated with your business. A sole trader will usually make all the decisions about running the business and can employ people to help run their business.

Tax liability: You pay tax as an individual on any income you earn from a sole trader business.

You’re also required to pay GST and submit a business activity statement if your turnover is more than $75,000 a year.

Partnership

Similar to a sole trader, the owner is liable for all aspects of the business; however, in a partnership, two or more people may take joint ownership and will distribute the income and losses between themselves.

A partnership business structure also allows individuals to pool their assets and skills to increase their chances of success. A partnership is also able to hire employees to help them run the business.

Tax liability: Partners pay tax as an individual with income from the business divided between partners. You’re also required to pay GST and submit a business activity statement if your turnover is more than $75,000 a year.

Company

A company is different to the previous examples of business structure in that when you set one up, you are creating a legal entity that is separate from you. This means the company itself can own assets and enter into contracts directly with third parties.

Tax liability: Companies are subject to company tax rates which are different from individual tax rates. The current company tax rate is either 27.5% or 30% depending on the criteria you meet. You’re also required to pay GST if your turnover is more than $75,000 a year.

Trust

A trust is a business structure in which certain trustees conduct business on behalf of the trust members. Trust members are also referred to as beneficiaries. This form of structure can be difficult to set up and expensive.

The trustee can be either an individual or a company and is responsible for any debts and liabilities. Trusts are commonly used to manage, protect, and pass on family assets including shares, personal property, and the family’s business from one generation to another.

Tax liability: The trustee distributes the business profits to the beneficiaries who then pay tax on the income received under their marginal individual tax rates.

Business Structure FAQs

What are 4 basic business structures?

1) Sole trader business structure.
2) Partnership business structure.
3) Company business structure.
4) Trust business structure.

What is a structure of a business?

A business structure describes the legal structure of a company or business that influences its day-to-day operations. For example, a sole proprietorship and partnership are simple to set up since they are not required to meet ongoing requirements such as shareholder meetings and voting. The type of structure your business decides to go for ultimately depends on its goals and specific requirements.

How will the business structure I choose affect my business?

Choosing the right business structure is one of the most important decisions to make as a business owner.

A business structure refers to the legal construction and obligations of a business or organisation. Your chosen business structure will affect:

  • how much tax you must pay
  • ongoing reporting requirements
  • business set-up costs
  • the way your business operates
  • legal liability

Sunshine Coast Business Structure location

North Lakes Business Structure location

Take a look at some of the other services that we provide in Sunshine Coast to facilitate success

At Total Business Partners, we are driven by the success of our clients. We are Xero certified accountants, well-versed in structural business planning and financial management, and always look to provide the best standard of service. With this in mind, we have chosen to offer the following comprehensive services to help Sunshine Coast businesses thrive. We also provide services to the wider Brisbane region, including North Lakes.

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