Home – New Forums Starting your journey Should I register a business name & GST or just start small?

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  • #979140
    lukelee
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    Hi, I am building a website for sell organic soaps online: http://onlyorganicsoap.com.au/
    The website is 70% finished, so now I am thinking these questions:

    • Do I need to register a business name?
    • Do I need to register a GST?
    • Do I need to set up a Paypal business acc?
    • Do I need to register a business bank account?
    • Do I must have a phone number and address on website?
    • How much time and money do I have to spend to setup the above things?

    OR

    • Can I just use my personal abn to do the business at the start?
    • My revenue will be less than $8000, can I skip the GST at the start?
    • Can I use my personal Paypal instead of opening a new business paypal account?
    • Can I use my personal bank account?
    • I have a full time job in the day time, so I don’t want people to ring me while I am in office, can I only leave email and live chat on the website?

    If I keep everything small, will this make ppl less confidence to shop on my website? Any idea’s would be appreciated. Thanks

    #1112292
    JacquiPryor
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    Hi There, congrats on your new business… I hope the following answers some questions for you:

    Do I need to register a business name?

    Yes. Looking at your current site, it appears that you are ‘trading’ by the name Only Organic Soap. If you are trading by anything other than your own personal name you must, at the very least, register a business name – see http://www.asic.gov.au to do so. An accountant could help determine whether a sole trader/business name is best for your circumstances, or whether a different type of structure is better.

    Do I need to register a GST?

    Not until you turnover more than the $75,000 threshold amount. Once you turnover this amount you must register for GST. If you don’t do so before hand, then you can not charge/show GST on any sales and it should be clear on invoices that you are not registered for GST. Likewise, if you have to pay out GST to suppliers and the like, you won’t be able to claim this back via filing of BAS and similar.

    Do I need to set up a Paypal business acc?
    Do I need to register a business bank account?

    This might depend on the type of business structure. If you go for sole trader with a business name, then you are the actual legal entity. A business name is more like an ‘alias’ for you rather than an actual entity. So, as a sole trader these accounts could be in your name still, as you are the legal person behind it – it would be a good idea to have separate accounts for business to your personal accounts, as it will be much easier to keep records etc.

    Do I must have a phone number and address on website?

    You don’t have to but I think it’s a good idea. You asked in your post if being small will mean people have less confidence… I think if you don’t have any real contact/business information at your site that this would be more likely to stop people having confidence than the actual size of your business. I look for a phone number, location, ABN and email address at a minimum when I am shopping online. If you’re worried about phone calls whilst at your day-job, consider a phone answering service/virtual phone service etc so calls can be answered professionally without interrupting you at work.

    How much time and money do I have to spend to setup the above things?

    There’s no black & white answer to that. The actual business name registration doesn’t take too much of your time and will cost $30 for 1 year or $70 for three years.

    I hope this helps, all the best with your new business :)

    #1112293
    Divert To Mobile
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    lukelee, post: 125178 wrote:
    If I keep everything small, will this make ppl less confidence to shop on my website? Any idea’s would be appreciated. Thanks

    If this is a concern for you there are ways of not looking like your running things part time. divert to mobile

    Steve

    #1112294
    Just Launch
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    Hi,

    If you are only running small operation with a few sales then running as a sole trader whilst incorporating the advice below will get you on the right track. Although it will become a hassle separating your costs and the business costs come end of year tax time.

    If you want to set up a new structure and have the business standing as a separate legal entity then you can easily set up a Family Trust to achieve this. Costs of setting up a Family Trust can be quite cheap (although this depends on which state you are in with regard to stamping of the trust deed).

    #1112295
    Kennethti
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    lukelee, post: 125178 wrote:
    Hi, I am building a website for sell organic soaps online: http://onlyorganicsoap.com.au/
    The website is 70% finished, so now I am thinking these questions:

    • Do I need to register a business name?
    • Do I need to register a GST?
    • Do I need to set up a Paypal business acc?
    • Do I need to register a business bank account?
    • Do I must have a phone number and address on website?
    • How much time and money do I have to spend to setup the above things?

    OR

    • Can I just use my personal abn to do the business at the start?
    • My revenue will be less than $8000, can I skip the GST at the start?
    • Can I use my personal Paypal instead of opening a new business paypal account?
    • Can I use my personal bank account?
    • I have a full time job in the day time, so I don’t want people to ring me while I am in office, can I only leave email and live chat on the website?

    If I keep everything small, will this make ppl less confidence to shop on my website? Any idea’s would be appreciated. Thanks

    It really sounds like you need to talk to an accountant. Jacqui’s given some brilliant responses but to find out what’s suitable for you, given the number of questions you are asking, you really should seek professional assistance.

    As for the answers, Jacqui’s mostly answered them but to rehash:

    1. If you trade in a name other than your own, or your entity’s name, you must register a business name and penalties may apply if you do not.
    2. You must register for GST if your turnover, which is all revenue, is more than $75,000 per financial year.
    3. It depends
    4. It depends
    5. Generally a good idea to have some sort of contact details. If you are collecting personal information from your clients yes. If you are providing some sort of warranty for your goods then yes.
    6. Hard to say. It really varies. But don’t also be fooled to thinking that these are your only outgoings – there’s certainly over time other expenses in business that you might not foresee.
    #1112296
    lukelee
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    Thank you very much, all of you. I guess I will register a business name, then open a business account and paypal, but skip gst at the moment.
    But not sure if I should put a mobile number on website.

    #1112297
    Divert To Mobile
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    lukelee, post: 125263 wrote:
    But not sure if I should put a mobile number on website.

    If that is a concern you could put a land line number on your website that would divert to your mobile. Added benefit is that you would know by the caller ID that it was a work call before you answered it.

    Steve

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