One of the most challenging aspects of establishing a new business, especially one based on a specialist creative skill, is the distraction caused by tedious but necessary administration.
The fact is, however, non-core business matters such as tax, finance and insurance can prove to be critical survival issues if they are not attended to on a timely basis.
The finance aspects will vary according to individual circumstances, and won’t be the focus of this article. Other essential matters such as tax and insurance can be readily dealt with through a combination of common sense, and the referral of detail to professionals with the appropriate skill and experience.
An reputable insurance broker will advise on the possible business risks, and offer a choice of insurance policies to address them.
In some instances it is possible to save on insurance premiums by carrying some of the risk directly, provided you make a well-informed judgement, preferably with the help of a broker and/or business adviser to adequately scope the risks and the potential losses should an insurable event arise.
Carrying your own insurance risk is not possible or commercially realistic in some instances – such as compulsory workers compensation insurance, or in respect to potentially very high claims associated with public liability and indemnity risks.
This then begs the question of the appropriate business structure. For example, an incorporated entity can provide additional protections against commercial risks, and can also affect the amount of tax you pay. These are matters to discuss and resolve with your professional advisers who can take into account your circumstances in recommending the best structure.
The personal tax income tax scales can be found here.
In addition, a commencing business in Australia will need to attend to a number of registration issues:
- business name registration
- ABN number
- registration for GST – required if projected or actual turnover exceeds the threshold, currently $75,000