Home – New Forums Starting your journey Which way do i go?? Pty Ltd? Sole Trader?

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  • #991092
    Poolz
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    • Total posts: 6
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    Hi guys,

    I am currently in the process of registering and forming my business. I am starting a distribution company which already has its connections with stock formed. I have everything i need ready to go but am stuck on one thing…

    Wanting to know the perks on going either…,

    Sole Trader
    Trading under a Business name
    Pty Ltd which I think I want to do?

    Also other avenues you would recommend to me? Cheers for any help :)

    #1179951
    PowerofWords
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    Hi,
    I think not many would be willing to step out and give advice on this important decision. Just to help inform you generally I have pasted this topic from my ebook “How to Start a Freelance Business”.


    For those with a higher risk of liability and those planning to grow their business beyond themselves, perhaps with many online products, the benefits of incorporation are many. But it comes with added responsibility in the form of ASIC / SEC registration and compliance… Tax Returns that are a little more complex, necessitating more Accountant fees… and WorkCover premiums (accident compensation) for all employees (this is anyone who draws a salary). [Although any employees must be covered for this regardless of business type.]

    For a quick and easy way to make a Pty Ltd company and register it (for a quarter of the price of an Accountant) try the site: Incorporator.com.au or Google search “Register a Company online”.

    The [ ] indicate where I have added a point that I neglected whilst writing the book. Nobody’s perfect!

    #1179952
    Alex (LegalVision)
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    Hi Poolz!

    We have a pretty good guide on this topic, have a look here;

    https://legalvision.com.au/business-structures-a-founders-guide/

    And do let me know if you have any questions about it.

    Alex

    #1179953
    Poolz
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    • Total posts: 6
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    Thanks for the information guys. If you start as a sole trader can the business be changed to Pty Ltd if i do successfully manage growth and bigger profit? Would it be better to do this if possible or to start out as a Pty Ltd? cheers again folks!

    #1179954
    MyGreatIdea
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    If you decide to register as a pty ltd company down the track, it’s simply a matter of registering the company and transferring ownership of the business name from yourself to the company.

    From an accounting perspective, it’s tidier and easier to do this from the start of a new financial year, but not necessary.

    Wendy :)

    #1179955
    Alex (LegalVision)
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    • Total posts: 52
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    Hello again :-)

    It’s actually very easy to set up a company structure. We generally also recommend you do this from the start. If you’re keener to launch as a sole trader you can change business structure at a later stage. The following article sets out how to do it: https://legalvision.com.au/change-business-structure-sole-trader-to-company/

    Good luck! And drop me a line if you have any other questions about it.

    #1179956
    My Guy
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    Hello,

    I cannot strongly recommend anymore than to go straight to a Pty Ltd.

    I have NOT done this 4 times throughout my businesses I have started over the years and all I can say is it’s a nightmare when it comes to changing from a Sole trader to a company.

    Your bank accounts need changing, your ABN & ACN get changed and or updated.

    Your plans or services with other business need to be updated.

    Your bank accounts get closed down and you to advise all your clients of new accounts and its just a nightmare.

    easycompanies.com.au are great and you can create pty ltd companies on here in minutes.

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