The Structure You Choose Matters More Than You Think
Most people starting a business in Australia pick "sole trader" because it's easiest. And for many, that's the right call. But the structure you choose affects how much tax you pay, whether your personal assets are at risk, and how easy it is to grow.
The Four Main Structures
1. Sole Trader
No legal separation between you and your business. You are the business.
- Report all business income on your personal tax return
- Personally liable for all debts
- Tax at individual rates (0–45%)
2025–26 Individual Tax Rates:
| Taxable Income | Tax Rate |
|---|---|
| $0 – $18,200 | 0% |
| $18,201 – $45,000 | 16% |
| $45,001 – $135,000 | 30% |
| $135,001 – $190,000 | 37% |