New Business FAQ

What is the difference between a business and a hobby?
Businesses pay tax on their income and can claim a deduction for business expenses.
For hobbies there is no tax on earned money and there are no claims on deduction for expenses.

Should my busines be a partnership or a company?
Sole traders, partnerships, companies and trusts have different legal obligations and are taxed differently.

Do I need an ABN?
An ABN is not compulsory for a business unless you need to:

register for goods and services tax (GST) and other business tax registrations
deal with other businesses
avoid having amounts withheld from payments

Does it matter if I run a business from home?
If you run a business from your home you need to check:

what expenses you can claim
whether you have to pay capital gains tax when you sell your home

Do you need to register for GST?
You must register for GST if:

your business expects annual sales of $75,000 or more ($150,000 or more if you are a non-profit organisation)
you are a taxi operator or hire car operator

What records do you have to keep, and for how long?
The tax law requires you to keep these records for five years:

sales and purchases
payments to employees
payments to other businesses

What is a role of a bookkeeper in my business?
Bookkeepers can set up your record keeping system and manage your records. Eligible bookkeepers can also prepare and lodge your activity statements.

Please note: bookkeepers can’t give tax advice.

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Bookkeepers can set up your record keeping system and manage your records. Eligible bookkeepers can also prepare and lodge your activity statements. Bookkeepers can’t give tax advice.