Guide to starting and expanding your business in NSW

Starting a small business takes a lot of work, but building a strong foundation can help lead you to success. Before you set up your business in New South Wales, you should think carefully about all the different practical and administrative tasks that must be completed. You’ll want to start off on the right foot, so you can hit the ground running.

Below are some of the things you should consider to help you open your business successfully.

1. Business planning

A well-written business plan can help you check whether your business ideas are truly viable. Many people get too caught up in the excitement of being their own boss and may be too enamoured of their idea to see that it may not work practically.

Business plans include your goals, how you plan to reach them, and other practical details about your small business. This often includes research into your service area and competition, marketing plans, and detailed budgets. It’s a good idea to ask an expert to run their eye over your business plan to check for viability.

Recommended reading: How to create a business continuity guide

2. Selecting your business structure

There are several ways to structure a business in NSW:

• Sole trader: This is the most basic and economical business structure available. As the owner you are responsible for all control and management of the business. Although you are classified as a sole trader, this does not mean that you can’t employ other people, just that they remain your employees, not partners.
• Company: Setting up a company creates a legal entity that is separate from you as an owner. You may decide that this is the optimal structure for your business, in which case you will have to make sure your company is registered with the Australian Government.
• Partnerships: A partnership exists when two or more people go into business together. Businesses can be formed as a normal partnership, a limited partnership, or an incorporated limited partnership. If you decide to use any of these structures you must register with the New South Wales Fair Trading Registry Service.
• Trust: Trusts comprise a specific person or organisation (the trustee) who holds property on behalf of another person or organisation (the beneficiary). Trustees can either be individuals or companies; companies offer a certain amount of protection for the assets held.
• Cooperative: Cooperatives are member-owned businesses consisting of five or more members. Should you decide to form a cooperative, you have to register it with the New South Wales Fair Trading Registry Service.

The most popular business structures are sole traders, companies, partnerships, and trusts. However, each option has its own pros and cons. It may be helpful to speak with a lawyer or accountant to decide which structure is right for your small business.

3. Starting your business

Once you’ve finalised your business plan and settled on a structure, it’s time to tackle the admin side of starting your business, such as completing important registrations and sorting out your tax information.

• Register for an Australian Business Number (ABN): It’s not compulsory to register for an ABN, but it has many benefits. These include allowing you to register an Australian domain name, to receive energy grant credits and to claim credits on Goods and Services Tax.
• Register a business name: Unless you are a sole trader or partnership with a business name that is identical to your own name (or that of you and your partner) you have to register a business name. You will need an ABN or an ABN application number to be able to do this.
• Register for Goods and Services Tax (GST): Any business that has a GST turnover in excess of AU $75,000 has to be registered for GST.¹
• Apply for a business or individual Tax File Number (TFN): Companies, trusts, or partnerships must all apply for their business Tax File Number. Sole traders must apply for an individual Tax File Number.
• Register for PAYG withholding: If you have to withhold tax (on behalf of the Australian Tax Office) from any payment made to contractors, employees, or businesses that haven’t given you their ABN, you’ll need to register for PAYG withholding.
• Get insurance: You have the option of taking out Public Liability, Professional Indemnity and other types of insurance to protect your small business. These types of insurance offer protections against claims such as damages to a customer’s property or someone is injured on your work premises. Although it may not be compulsory, it is vital for businesses.
• Register for fuel tax credits: You should check if you are eligible to register for fuel tax credits related to the fuel your business uses.

4. Acquiring and developing premises

Before you start to develop the premises from which your business will operate, you may need your local council’s consent. Regulations vary from council to council, so check them carefully. In some parts of New South Wales, you might have to apply for a development application and/or a complying development certificate. Both of these can be applied for through the New South Wales Planning Portal.

If you want to put up a sign for your business or an awning that overhangs the street, you may need permission from your local council. You may also need a zoning certificate which will show you what you can and can’t do with your property. Heritage listed properties need approval for development.

Any building work will require a local council construction certificate giving permission for your development, and you will have to nominate a principal certifying authority to check the building work.

Fire safety certificates can be acquired from your local council, who will issue an occupation certificate once you’ve passed inspection. Any building work may require a compliance certificate before the occupation certificate is issued.

5. Prior to commencing trading

Various regulations must be complied with before you begin trading:

• Your water provider may have to give you approval for the discharge of waste water from a commercial enterprise into public sewers.
• You need to register any regulated water systems, e.g. warm water systems or water cooling systems, with the local council.
• You’ll have to get your local council’s approval to leave commercial waste in a public place to be collected.
• If your business will be playing music, there are two different licenses you need to comply with copyright laws.

6. Selling goods

If you are going to sell goods, you must make sure that you are compliant with Australian Consumer Laws. You should check these carefully and make sure that you are aware of all the rights your customers have if they buy goods or services from you and the responsibilities you have to comply with guarantees.

There are also strict competition and consumer laws detailing the ways any Australian business has to behave towards their suppliers, customers, and competitors. These laws apply to both online and “bricks and mortar” businesses. Specific regulations apply to the ways in which prices are displayed or advertised and you must comply with these. Exemptions must be applied for if you want to open your business on restricted trading days, which include Good Friday, Easter Sunday, Christmas Day, and Anzac Day before 1 pm.

If your business is going to be importing or buying goods produced overseas, certain types of goods require permits to get through customs. Prior to ordering any goods from overseas you should check all the relevant regulations and make sure you are compliant with them.

Good luck!

Whatever type of business you are planning in New South Wales, never forget that insurance can help protect what you are building. Public Liability insurance may be especially important to ensuring your future success. If you are not covered in the event of a mishap resulting from the operation of your business, you stand to lose everything you have worked so hard to create.

Get Public Liability insurance for NSW businesses.

1. Australian Taxation Office, Registering for GST, accessed 29 October 2021

——————————