Before commencing any business activity, business owners should make sure that the new business complies with all the requirements set and promulgated by Australian laws.
Thoroughly understand, comply with, and abide by the following legal requirements and considerations:
- Business registration
- Business structure
- Licence application
- The Privacy Act
- Independent Contractors
- Anti-bullying laws
- Unfair dismissal
All business owners need to register the business and the business name. A number of specific taxes could be applied to the new business. There are required registration procedures in place, depending on certain particular considerations as mandated by law.
These include registering for the following:
- Australian Business Number (ABN)
- Goods and Services Tax (GST)
- Tax File Number (TFN), and
- Pay As You Go (PAYG) Withholding Tax
Otherwise known as a trading name, a business name is a name or title under which an individual or any other legal entity trades or does business. A business name identifies the business to customers and differentiates the business’ brand from competitors. It is considered one of the, if not the most valuable asset of a business organisation. Registering a business name will connect it to the business owner’s ABN
To register a business name, decide on a name that suits the business and the products and/or services it offers. Check if the name is still available by doing an online business name search on the Australian Securities and Investments Commission (ASIC) website
A business name is not automatically a trademark. If the business needs to gain and exercise exclusive rights on the business name, have the name trademarked. Check whether the name is already a registered trademark to avoid trademark infringement rights issues. You may also do a trademark check via the Australian Trade Mark Search provided by the Australian government’s IP Australia website.
The business registration fees with the ASIC are as follows:
- $35.00 for one year
- $82.00 for three years
Registration takes an average of 12 minutes to complete online. If a business owner already has an ABN and has provided all the necessary documents and paid all fees, expect a confirmation. If payment was done via credit card, wait for confirmation for up to two business days. If payment was done via bank transfers, BPay, or EFT, expect confirmation for up to five business days.
Determine which business structure suits the business venture and its current and future business goals.
Determine whether the business will be registered as a sole proprietorship, a partnership, a trust, or a company. Each business structure comes with specific taxation, health and safety obligations, and regulatory requirements. Consult with a trusted lawyer and/or accountant with proven expertise to advice on the best business structure for your needs.
Different businesses and business structures require different licences to start operations. Licences and permits can also depend on the particular products and/or services that the business offers. Seek advice from a lawyer and other relevant professionals to cover all licensing requirements specific to the business to avoid fines and legal difficulties.
The Australian Business and Licence Information Service (ABLIS) website has a list of all licence(s), permit(s), and registration(s) necessary to commence business operations. The ABLIS site also has guides on all the government standards, guidelines, and codes of practice that must be understood by business owners in compliance with all responsibilities and obligations as mandated by Australian laws.
The Privacy Act
A new set of privacy principles introduced in March 2014 to the Privacy Act of 1988, as mandated by the Australian Privacy Principle (APP), contains specific promulgations and business owner obligations. These principles are enumerated in the Office of the Australian Information Commissioner (OIAC) website.
The principles cover how businesses ought to:
- Handle, manage, and process personal information
- Use personal information for direct marketing purposes and other relevant activities
- Disclose personal information to people outside Australia
The OIAC website provides a checklist to determine whether or not the business complies with the specifics contained in the Australian Privacy Principles. The checklist includes questions to help inform a business owner’s obligations in the use, management, and processing of personal information, including particular considerations that may or may not apply to the business.
Independent contractors are self-employed individuals who provide service to the business. They usually negotiate their work arrangement specifics and remuneration. As independent contractors can work for a range of other clients, they may or may not provide exclusive service to the business.
An independent contractor’s status can affect work rights and obligations. Before entering into a contract with independent contracts, understand that a person can both be an employee and an independent contractor for two different businesses.
It is against labour laws to force an employee to change employee status and become a contractor. It is also against labour laws to threaten and fire employees for refusal to become a contractor.
The Department of Industry, Innovation, and Science makes it easier to find out whether someone is likely to be an employee or independent contractor via its Independent Contractors decision tool, available on the department’s website.
Workers who believe that they’re being bullied or who have and is experiencing workplace bullying can resolve the issue by escalating the said issue and to the Fair Work Commission.
If an employee has continuously demonstrated incompetence, a business owner may decide to terminate employees. The Fair Dismissal Code enumerates the rules in legally terminating an employee.
For small businesses with employees fewer than 15, the code that business owners need to comprehensively understand and abide by is the Small Business Fair Dismissal Code.
Consult and engage the services of a trusted lawyer and/or other relevant professionals to assure the business complies with all legal requirements and follows are legal considerations in starting and operating a new business.