There are nearly one million people in
running a business from home. If you are planning to join these home-based entrepreneurs, ask yourself the following questions. Do you think your home is a suitable place for work? Can you do your business under local council regulations? What are your legal obligations? Will you be able to balance a business with family commitments? Australia
Getting advice is the first step. Consult an experienced business adviser with the help of Advisor Finder. You can also contact the Business Enterprise Centre for free advice. Search for business associations and find events relevant to your business to attend.
Talk with your business adviser which business structure is the most suitable for your business. A business structure affects the licences you need, the amount of tax you pay, your liability, the costs and volume of paperwork and how much control you have over your business. Small businesses are usually divided among four business structures: a sole trader, a company, a partnership and a trust.
Visit the Australian Business Licence & Information Service website to find licences and permits in your state and territory. Generally speaking, you will need to register your business name. If you are doing a business online, which is often the case with home-based businesses, you need to register a domain name, as well. If you decide your business structure is a company, you will need to register it with the advantage of having exclusive rights to that name in the entire
, regardless of the state. Registering your business as a trade mark means that you can protect your business name from being used by someone else. Australia
An Australian Business Number (ABN) is a unique 11 digit number identifying your business to the government and the community. It is used for various tax and business purposes. Not everyone needs an ABN, so contact your business adviser. What is highly likely you will have to pay is Goods and Services Tax, or GST. It is a tax of 10% on most goods, services and other items sold. If your business has an annual turnover less than $75 000, you do not need to register for GST. Unless you are a sole trader, you will need a Tax File Number, too. If you make payments to some contractors, register for Pay As You Go withholding.
In the case of home-based business, insurance should cover yourself, your business and your home. Public liability is useful if you will have other persons visiting your house for business purposes. Asset insurance for home office equipment is also recommended. If you plan to send products via freight carriers, or post, consider marine policy. Insurance covering loss of income due to personal accident, or illness can protect any type of business, including yours.
Home office expenses
You can claim deductions for home expenses including electronic devices used for work purposes and a deduction for running costs. When it comes to a deduction for running costs, it includes costs for home office equipment, work-related phone calls, heating, cooling and lighting, cleaning expenses and the costs of repairs to the home office furniture.
Home office security
After you have decorated your home office, you should take measures to protect it from burglary. CMI safes are essential for home-based businesses as you will still have to safeguard sensitive documents, such as passports, insurance policies, birth certificates and social security cards. Consider also a smart security camera, you can connect to your mobile. Look for smart locks along with deadbolt locks for your home office. If you leave your laptop when you are on a vacation, for example, you can opt for a keyed laptop lock, as well.
Whether you will hire an accountant, or not depend on you and your business. During the first months, you can try handling your financing yourself, while if your business grows, you will definitely need an accountant. He/she can help you save money, as well. If you decide to handle your paperwork yourself, find web-based programmes offering invoicing, time tracking and client information storage accessible only by you. Consider digital storage options, as well as a digital copler, which can turn paper documents into digital files.
Now that you have registered your business and set up your office, you are ready for creating your business plan. Write main goals for your business as well as possible obstacles and how you can overcome them. It will provide you direction whenever you are in doubt.