Thinking about starting a business?
Before you dive in, it’s important to make the right foundational decisions that will support growth, minimise risk, and keep you compliant. Here are five essential steps to help you get started on the right foot.
Table of Contents
1. Build Your Business Plan
Your business plan should outline what your business does, how it operates, and where it’s heading. Even a one-page plan helps you get clear on your offering, your ideal customer, and how you’ll deliver your service or product.
It’s also the time to think about your broader mission and long-term goals. Defining why your business exists beyond profit will give it direction and purpose.
Tip:
Use a free business plan template (like Xero’s) to get started quickly and stay focused.
2. Select Your Business Structure
Choosing the right structure impacts everything from how you pay tax to your level of legal protection. The most common options for small businesses are:
Sole Trader
The simplest and cheapest structure. You’ll be taxed personally on all profits, and you’ll be personally liable for any business debts — which may put assets like your home at risk.
Company
A separate legal entity. Companies are more complex to set up and run, but they offer asset protection and a flat 25% small business tax rate. Compliance is stricter, but it may make more sense if you’re earning above the GST threshold or want to grow.
Partnership
Two or more people or entities trading together. Easy to set up, but partners are jointly liable — even for each other’s actions.
Trust
More complex and costly, but useful in specific situations. A trust holds assets on behalf of beneficiaries, and typically requires a company to act as trustee. Trusts should always be set up with professional advice.
Tip:
There’s no one-size-fits-all structure. Speak to your accountant to choose what suits your goals, income, and risk profile.
3. Use the Right Accounting System
Separating business and personal finances is critical from day one. Open a dedicated business bank account and choose accounting software that supports automation and accuracy.
Xero is a popular option and is widely used by bookkeepers and accountants. It’s easy to use and can grow with your business. You can manage your own books, but as your business scales, outsourcing bookkeeping and payroll will save you time and ensure compliance.
Tip:
You don’t need full-time help — many small businesses outsource accounting and bookkeeping for flexibility and cost savings.
4. Get the Right Insurance Cover
Protecting your business means understanding which insurances are compulsory — and which ones are wise to have based on your risks.
Compulsory Insurance:
- Workers’ compensation (if you have employees)
- Third-party personal injury insurance (if you own a vehicle)
- Public liability (for certain industries)
Optional (but recommended):
- Income protection
- Asset, stock or product insurance
- Professional indemnity
- Cyber insurance
- Goods in transit insurance
Tip:
Licensed financial professionals must advise on specific insurance products. Talk to your accountant or advisor to get pointed in the right direction.
5. Understand Your Compliance Obligations
Starting a business comes with a legal responsibility to comply with Australian laws — from tax obligations to employee entitlements.
Having a compliance program helps reduce risk, spot issues early, and show that your business takes its responsibilities seriously. Even a basic checklist and review process can keep you on the right track.
Tip:
Depending on your industry, it may be worth scheduling regular compliance check-ins with your team or advisor.
Start Your Business Right From Day One
Getting your business set up properly isn’t just about ticking boxes — it’s about creating a solid foundation for growth. Accountants and bookkeepers are often the first professionals new businesses bring on board because having clean, accurate finances gives you more control, confidence, and clarity from the start.
Ready to launch your business? Book a free 45-minute call with a small business accountant at JVP Advisory today.
