Starting a business in Australia involves a series of consecutive steps. For a successful launch without delays, first you’ll need to get your Australian Business Number (ABN) and director identification number (director ID), register for your goods and services tax (GST), and then establish your payment mechanics.

Below, we’ll discuss how to start a business in Australia, the possible legal structures, where to register before you can trade, and how to build a payment workflow that will scale with your business.

Key takeaways

• The structure you choose for your business—sole trader or proprietary limited company (Pty Ltd.)—determines your tax rate, your personal liability, and required registrations.

• Each company director needs a director identification number (director ID). This is a permanent number that follows them across every company they ever direct.

• Setting up payment infrastructure early on that covers online checkout, in-person sales, and recurring billing can save your business from a disruptive switch later on.

What is involved in starting a business in Australia?

When you start a business in Australia, you deal with three separate government bodies. The Australian Taxation Office (ATO) handles your tax obligations, the Australian Securities and Investments Commission (ASIC) covers company registration and business names, and the Australian Business Registry Services (ABRS) issues your director ID if you’re forming a company.

The steps to start a business are as follows: pick a legal structure, apply for an ABN, get a director ID (if you’re setting up a company), register a business name (if you’re not trading under your own legal name), and register for GST once you meet sales thresholds.

How do you choose a legal structure when starting a business in Australia?

Choose a legal structure based on your preferred tax rate and personal liability level. Many first-time founders choose between a sole trader and proprietary limited company (Pty Ltd.).

Here are the available business structures:

Sole trader

With a sole trader structure, you and the business are the same legal entity. This keeps setup fast and cheap and lets you report business income on your own tax return. However, this structure gives you unlimited personal liability, so if the business accrues debt or gets sued, your personal assets are exposed.

Pty Ltd.

With a Pty Ltd. structure, the business is its own legal entity, separate from you. This gives you limited liability protection over your personal assets. It also brings more requirements: you pay a flat company tax rate instead of your individual marginal rate, you need at least one director with a director ID, and you have ongoing reporting obligations to ASIC. If you’re planning to bring on investors, hire staff quickly, or sign contracts with real liability exposure, this structure could be a better option.

Partnerships and trusts

These structures exist for specific situations, such as when multiple founders want to pool assets or a family business is managing succession. They aren’t default choices for a solo first-time founder.

What registrations do you need before starting a business in Australia?

Starting a business in Australia requires several registrations, which you should complete before you begin trading.

Here’s what each registration does, and when you need it:

• Australian business number (ABN): This 11-digit number identifies your business to the ATO and anyone you invoice. You need an ABN in order to invoice legally, register for GST, and claim GST credits on business purchases. Apply for one through the Australian Business Register.

• Tax file number (TFN): Companies need their own TFN, which the ATO uses to track your tax obligations. Sole traders can use their individual TFN for their business.

• Registered business name: If you’re trading under anything other than your own legal name or your registered company name, you need to register that name with ASIC. A sole trader named Jane Smith trading as “Smith Consulting” needs to register that name, but that same sole trader just trading as “Jane Smith” doesn’t.

• GST registration: GST registration is required once your turnover reaches or is expected to reach $75,000 Australian dollars (AUD) in a 12-month period. Some businesses register for GST before hitting this threshold because it lets them claim GST credits on expenses, while making the business look more established. Once you’ve registered, you’ll report the GST you’ve collected and paid by lodging a Business Activity Statement (BAS) either monthly or quarterly.

Why does the director ID requirement matter when starting a business in Australia?

If you’re setting up a company in Australia, you’ll need to get a director ID. The director ID is meant to reduce illegal phoenix activity, where directors liquidate a company to dodge debts and then restart under a new name. It’s a permanent, verifiable identifier that follows a director across every company they’ve ever been involved with and stays with them for life. If you plan to become a director, you’re required to apply for a director ID before you’re appointed. To get one, you’ll need official documents such as your driver’s licence, passport, or Medicare card. Since it’s permanent, you only apply once through the Australian Business Registry Services (ABRS).

How should you set up financial infrastructure when starting a business in Australia?

Developing financial infrastructure is a fundamental part of setting up a business in Australia. Once your registrations clear, the next job is to separate your business finances from your personal ones.

Here are the steps:

1. Open a dedicated business bank account

A dedicated business bank account isn’t strictly required by law for sole traders. But mixing personal and business transactions complicates tax filing and can make it hard to assess your business’s performance. When you open a business bank account, Australian banks will typically ask for your ABN and, for companies, your ASIC registration details.

2. Set up accounting software

You’ll need accounting software that handles GST tracking, BAS lodgment, and invoicing. Completing these tasks manually will be nearly impossible once your transactions ramp up.

3. Set up payment infrastructure

Promptly set up payment infrastructure that covers all potential transactions, including online checkout, in-person sales, and recurring billing. Offer the payment methods your customers expect. In Australia, this usually means accepting cards, digital wallets, and (depending on your customer base) buy now, pay later (BNPL) options. Establishing this from the start can save your business from a disruptive switch later. A payment provider such as Stripe gives Australian businesses a single integration point for dozens of payment methods and allows them to reconcile in-person and online sales in one place.

How can you evaluate your readiness before starting a business in Australia?

Before you make your first sale, confirm your ABN and, if applicable, your company’s TFN and ASIC registrations. Every director should have a director ID, and make sure you’ve registered for GST, or plan to once you cross the $75,000 AUD threshold.

Your business bank account should also be open and separate from your personal finances before you start your business. Confirm your payment workflow is set up properly and can process sales—whether online, in person, or both. Once these tasks are complete, you’re ready to go.

How Stripe Atlas can help

Stripe Atlas handles everything you need to legally launch your company—incorporation, employer identification number (EIN), equity setup, and tax filings—so you can fundraise, open a bank account, and start accepting payments in as little as two business days, from anywhere in the world.

Join 100,000+ startups incorporated using Atlas, including startups backed by top investors like Y Combinator (YC), a16z, and General Catalyst.

Get started in minutes with Atlas

The application takes under 10 minutes. You’ll choose your company structure, confirm your name is available, add up to four cofounders, set your equity split, and e-sign. Then Atlas takes it from there, including notifying cofounders to sign their documents electronically.

Banking and payments before your EIN arrives

Atlas files your EIN application automatically after incorporation. You don’t have to wait—Atlas enables pre-EIN payments and banking so you can start accepting payments and making transactions right away. US founders with a Social Security number (SSN) are typically eligible for expedited IRS processing.

Automatic 83(b) tax election filing

Atlas files your 83(b) election for you—US and non-US founders alike—with US Postal Service (USPS) certified mail and tracking to reduce personal income taxes. You’ll get a signed 83(b) election and proof of filing directly in your Stripe Dashboard, with certified mail confirmation.

World-class company legal documents

Atlas provides all the legal documents you need to start running your company, drafted by Cooley, one of the world’s leading venture capital law firms, and stores them directly in your Stripe Dashboard. These documents are designed to help you fundraise immediately and ensure your company is legally protected, covering aspects like ownership structure, equity distribution, and tax compliance.

$2,500 in Stripe credits, plus $50K+ in partner discounts

Atlas startups get $2,500 in Stripe product credits for their first year, plus $50,000+ in discounts on essential tools—Mercury, AWS, Carta, Xero, Perplexity, and more. Delaware registered agent service is also included free for your first year.

Learn more about how Atlas can help you set up your new business quickly and easily, and get started today.

FAQs about starting a business in Australia