How Should I Structure my Business
(aka what is the best legal structure
for my business)?
Choosing the right business operating legal structure when you start a business is vitally important.
There are various matters to take into account when deciding on the suitable business structure. For example, the type of product you will be selling, the number of staff you will employ, how you will be dealing with your customers, how big you think your business will become, etc.
The legal operating structure you choose will impact your taxation obligations, your personal liability exposure, your control, and how to pay yourself from your business.
You can structure your legal operating structure as a sole trader, partnership, trust or company (for example a Pty Ltd).
Each structure has its own pros and cons and some structures are more complicated to manage than others. You may have significant secretarial documentation and filing as well as reporting requirements, depending on how you structure your business.
Before deciding upon a legal operating structure, it is advisable that you consult your accountant for advice.
PS: Rest assured, in future, if your chosen legal operating structure is no longer fit for purpose, then a new legal structure can be put in place. This can normally be done with a minimum amount of disruption to your current business operations. It just takes a little bit of time, some effort, some cost and paperwork to get it up and running.
At Expert Bookkeeping and Accounting Services, as experienced bookkeepers and accountants, we can advise you on what we believe to be the best legal operating structure for your new business and what is involved in setting it up, including establishment costs, and the ongoing documentation, filing and reporting obligations.