Choose your business structure
What business structure should I choose? Choosing the right business structure is a crucial decision that affects your legal responsibilities, taxes, and how your business operates.
Different structures come with different rules, legal liabilities and benefits.
Understanding these differences is vital because your choice affects your personal financial risk and business obligations. Because of these complexities and risks, it is highly recommended that you seek professional advice from an accountant, lawyer or business advisor before deciding on your structure.
This will help to ensure your choice matches your business goals, risk tolerance and compliance requirements.
For further information and assistance with choosing a business structure, we recommend you speak with your accountant or one of the New Business Support Service or Tasmanian Business Advice Service advisors.
The four most common business structures
Additional business structures to consider:
In addition to for-profit structures, there are also business structures commonly used for community benefit, not-for-profit or charitable purposes.
- A Co-operative is a group of people who work together to share the benefits of the business, with all the members having a say in how it is run.
- A Not-for-profit business focuses on a cause or purpose rather than making profits. Any surplus funds are reinvested to support the mission.
- A Registered charity is a not-for-profit organisation approved by the government to operate for public benefit, often eligible for tax concessions.
- An Indigenous corporation is a business structure registered through The Office of the Register of Indigenous Corporations (ORIC) that offers added benefits and supports First Nations communities through initiatives like education, housing, land rights, legal aid, infrastructure and the arts.