Starting a small business

Even before you decide to start a small business you’ll need to ensure you are eligible to do so and consider the best structure for your business.

Are you eligible to start a company or business?

Some people are automatically disqualified from managing companies or operating businesses in Australia.

Can a bankrupt, disqualified or convicted person become a company director or manage a company?

If a person is a bankrupt they cannot manage a company during the period for which they are bankrupt. For more information see bankruptcy and personal insolvency agreements.

ASIC has the power to disqualify or ban you from managing a company for up to five years if:

  • you have been involved in two or more failed (liquidated) companies in the last seven years, and
  • a liquidator has lodged a report with ASIC for each of the companies about the companies' inability to pay its debts.

If a person has been convicted of certain offences, including fraud, they are automatically disqualified from managing a company for five years from the day they were convicted, or if imprisoned, from the day they were released.

Can you register a business if you have been disqualified from managing a company?

Certain entities are disqualified from holding a business name if the entity has been disqualified by ASIC from managing a company. An entity can be:

  • an individual
  • a body corporate
  • a company
  • a partnership
  • any other unincorporated association or body of persons
  • a trust
  • a superannuation fund

You must notify ASIC if you, or a person involved in the management of your business, is disqualified from holding a business name. It is a criminal offence to manage a company when disqualified.

Choosing a business structure

When you start a business, it is important to choose a structure that best suits your needs. The most common types of business structures are sole trader, partnership, joint venture, trust and company.

Find out more about how to choose a business structure.

Registering a business name

A business name is the name or title under which a person or company conducts business.

You need to register a business name if you conduct business under a name other than your own personal name, or if you operate a company that conducts business using a name that is different to the registered company name.

You can choose to register a business name for one or three years. Be sure to consider what is required to maintain a business name, including fees and business name availability, and what to do if you would like to transfer or cancel the business name. All business names used in Australia are registered with ASIC.

Find out how to register your business name.

Download the First Business App

Our First Business app can help you get started in your small business. The app includes:

  • Business health check - helps you work out if you are ready to take on the challenge of running a small business
  • Starting your business checklist - assists with organising some of the requirements of running small business including registrations, licences, tax and super responsibilities and legal requirements
  • Case studies - examples of things that can go wrong and how to avoid them
  • Networking section - provides tips and ideas about how to develop your business network.

Download the First Business app now.

We also suggest you complete our First Business online learning module which will help you decide whether starting a small business is right for you.

Last updated: 02/05/2019 03:04