In Australia, there is a range of laws, regulations, standards and ethical practices that could affect how you run your small business. Considerations you might need to make to comply with these include:
Your business structure and size will determine some of the steps you’ll need to take. Keep reading for our simple accounting and business compliance checklist for Australian business owners.
This is step one on most accounting checklists, and for good reason. ABN are unique numbers used to identify businesses and are required for all businesses to trade.
An ACN is a compulsory identifier specifically for companies; they are automatically assigned by ASIC when a company is registered. All companies need to register with ASIC to trade in Australia.
A TFN is a number that the Australian Tax Office (ATO) uses to identify businesses for tax purposes. All businesses in Australia need a TFN. If you’re a sole trader you can operate with your personal TFN, but talk to us to check whether this is the best business structure for you.
If you’re setting up a company, all company directors need to have a Director ID before they start. This is one compliance activity that accountants can’t help with, which is why we created an easy step-by-step guide on how to create a Director ID.
Unless you’re a sole trader who wants to trade using your own name, you’ll need to register a business name. If you’ve chosen to structure your business as a company, you’ll also need to register your business name if you want to trade under a different name than the legal name registered with ASIC.
If your business will make over $75,000 a year, you’ll need to add registering for GST to your business compliance checklist. The Australian government requires you to add this 10% tax to the price of your goods or services if you meet the 75K threshold, and it’s worth mentioning that you can actually claim back the GST that your business pays on purchases through GST credits.
Our best accounting advice for startups is to always plan for the business you want, so even if your revenue is below the threshold you should register for GST if your goal is for your business to grow.
If you voluntarily register for GST but are making less than 75k, you’re able to claim back the GST you’d paid on your expenses.
If you pay an employee you’ll need to have registered for PAYG withholding tax in order to be compliant with the ATO. This means that when paying someone you’ll need to pay the portion of their income that’s expected to be withheld in tax.
If you’re paying employees, you might need to register for your state’s payroll tax. Each state’s tax is slightly different, but all of them apply only after the amount you’re paying people exceeds a certain threshold. These thresholds are pretty high in most states, but it’s a good idea to check if it’s something you’ll have to pay. You can do that here.
Having a separate bank account is compulsory for all businesses, except sole traders, where it’s only strongly recommended. You should create a business bank account as soon as you have all the relevant documentation. Your chosen business structure and the bank you apply with will affect the documentation you'll need to open an account; the bank you select will give you more specific details.
Superannuation, or super, is a long-term investment plan that’s paid by employers. As an employer, you need to pay the mandated Super Guarantee into an employee's superfund on top of their ordinary salary and needs to be paid at least quarterly.
The Super Guarantee is in the process of increasing to 12% and will rise by half a percent each year until 2026. If you use a single touch payroll system (see below), these are normally updated to make sure you’re paying the right rate.
If you’re paying wages and your business isn’t registered for GST, you’ll need to submit a statement that summarises your PAYG withholding called an IAS.
If your business is registered for GST, you’ll need to lodge your BAS on a monthly or quarterly basis instead (it’s quarterly if your revenue is less than $20mil per year).
This statement reports on your business income, payments to employees, and any tax that has been paid or withheld. We’re a Tax Agent, so our team can help with this and lodge these statements for you, so you have peace of mind you’re getting your compliance activities right, and that come tax time, all your accounts are in order!
| Reporting period | BAS quarterly due date for 2022 | BAS quarterly due dates for Tax-Agents for 2022 |
|---|---|---|
| July, August, September | October 28 | November 25 |
| October, November, December | February 28 | February 28 |
| January, February, March | April 28 | May 26 |
| April, May, June | July 28 | August 25 |
As well as your individual tax return, you’ll need to submit a tax return for your business (unless you’re a sole trader, in which case you report your business activities in your personal tax return).
You need to keep tax records for at least five years, and this includes all receipts (here’s what we recommend you do to keep those organised). You’ll need to submit your tax return by the dates below, unless you’re filing through us, in which case you can get more time.
Make sure you’re still getting in touch with us before the due date to make sure you qualify.
STP is cloud-based software that automatically works out how much tax and super you’re paying your employees and reports it to the ATO. It was introduced to make reporting to government agencies easier, and it’s now compulsory.
If you’re an employer, you’re probably required to have workers' compensation insurance. This covers any lost wages or medical expenses of employees who hurt themselves at work. WorkCover requirements vary state by state, so if you’re operating across Australia you’ll need to register for WorkCover in each state that you employ people. You’ll also need to lodge an annual reconciliation of your WorkCover premiums which is due on a date specified by the state you’re operating in.
Depending on the nature of your business, you may need to take out insurance that protects your business against negligence claims or protects your property. It doesn’t matter how careful your business is, insurance is sometimes almost compulsory – some suppliers and partners won’t work with you if you don’t hold public liability insurance.
Admin and bookkeeping not your strong suit? We’re here to help.
If you want to run your business and not let your business run you, consider getting an accountant (👋 ) to make sure you don’t fall behind on your compliance activities.
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