An individual person can own and operate a business. There is no special procedure to set up as a sole trader, other than the requirement to register a business name under the Business Names Registration Act 2011(Cth) if the name of the business is not exactly the same as the individual's name.
ASIC is responsible for the registration of business names under the Act, and useful information about what is required to register is available on ASIC website on the Business Names page.
A person running a business as a sole trader becomes personally responsible for any debts and obligations arising from the business, which is the main disadvantage of this structure. However, it is very easy to set up, and the ongoing administrative requirements are minimal compared to other methods of holding.
All of the income from the business and expenses are, for tax purposes, assessed in the name of that owner. If the turnover of the business exceeds $75 000, it must be registered for the GST. Check www.ato.gov.au for further information.
The content of the Law Handbook is made available as a public service for information purposes only and should not be relied upon as a substitute for legal advice. See Disclaimer for details. For free and confidential legal advice in South Australia call 1300 366 424.