Australia is regularly rated as one of the best countries to start or operate a business in, but no matter where you set up a business there are always challenges.
Australia has a robust economy with steady growth prospects and a low-risk environment. They are attracting more and more talent from overseas and are a highly educated, multicultural workforce.
If you’ve decided to set up a business in Australia where do you start? And what are some of the challenges you might come up against?
We’re going to take you through some of those challenges to make sure you’re fully prepared to run your business in Australia and take advantage of the economy and growth prospects.
Starting your business is actually fairly easy and will take no more than two days to complete. You need to:
- Complete and lodge ASIC Form 201 “Application for Registration as an Australian Company”
- Obtain a certificate of incorporation
- Obtain an Australian company number
- Register for an ABN with the Australian Tax Office
If you need to build facilities in Australia or make any changes to existing facilities, you’ll need construction permits. In Australia businesses must complete 11 different procedures associated with construction permits, these include several inspections and approval from local authorities. While this sounds like a lot, compared with other countries this is a fairly straightforward process.
This can take a frustratingly long time in comparison to setting up utilities in a private residence. Setting up utilities for a business can take around 75 days so be prepared to wait and plan ahead! You’ll need to complete a number of procedures for utilities at the time you register your business. Some of these include needing to complete a CT Metering form and arrange for an internal wiring inspection.
As a general rule businesses will need lines of credit or small-business start-up loans, this is one of the easier steps you’ll go through in setting up your business. Australia’s robust financial system means you’ll have a wide range of loans and funding options available to apply for and if you’re willing to shop around to find the best deal you should.
The best advice to manage Australia’s requirements would be to hire a local accountant, that way you can rely on their expertise in Australia. Something to keep in mind is the superannuation levy which requires you to pay towards your employee’s retirement, currently that levy is at 9.5% but will be increasing over the next few years to 12%. You’ll also need to pay the corporate income tax with is 30%. You should have registered with the Australian Tax Office (ATO) when you first set up your business and can follow up with the ATO for further instructions.
Imports and Exports
With the nature of online business trading internationally is fairly common and Australia is a popular place for import/export businesses due to the range of Free Trade Agreements the country has with other nations around the world. If you want to import and/or export you’ll need to complete the required documentation with the Australian government for your business which can take anywhere from a couple of week to a few months to be approved.
The Australian business culture can be one of the hardest aspects to doing business in Australia for many people. In other countries the business world is more formal and structured, in Australia you’ll find hardworking but relaxed and informal attitudes and often slow decision making. Having said that, due to the small market many businesses rely on international trade and are experienced in working with many different countries so cultural barrier to trade aren’t really an issue.
Australia’s judicial system is modern and can be used to enforce contracts and resolve insolvency problems. Processes are fairly streamlined but if you need to use it make sure you understand your rights and what’s required of you under contract.
The GST is Australia’s federal Good and Services Tax (known as VAT in other countries) of 10%. While there are some exclusions (GST-free goods) these are not always as clear cut as they may first seem so make sure you understand the GST treatment of good or services you’re providing.
Australia is only becoming more global and accessible for international investor but like any business venture, make sure you do your research, know your market and be ready for the challenges you may face.
Before you can consider setting up your business in Australia you need to obtain the right type of visa. Get in touch with one of our Immigration Experts today to find out which Business Innovation and Investment program is right for you.