Starting a business: a checklist for the first 90 days
Most people who start a business know their trade or their product well. What they don’t know is everything else: registrations, tax, insurance, software and cash flow. Getting those right in the first few months saves a lot of money and stress later.
1. Check the idea stacks up
- Who are your customers, and how will they find you?
- What will you charge, and does that cover your costs and pay you a wage? See how do I make my quotes profitable?
- How long until money comes in, and how will you live in the meantime?
A simple budget and cash flow forecast for the first 12 months answers most of these.
2. Choose a structure
Sole trader, partnership, company or trust. Start simple unless risk or profit says otherwise. See how to choose the right business structure.
3. Register
- ABN (Australian Business Number): free, through the Australian Business Register.
- Business name with ASIC, if you trade under any name other than your own.
- Company registration with ASIC, and a director ID, if you’re using a company.
- GST: once turnover reaches $75,000, or from day one if you drive rideshare. See rideshare and delivery drivers.
- PAYG withholding before you pay your first employee.
- Licences and permits for your industry and council.
- Domain name and social handles to match your business name.
4. Separate the money
Open a business bank account from the start. Mixing business and personal spending is the most common cause of messy books, missed deductions and arguments with the ATO.
5. Set up your software properly
Cloud accounting software such as Xero, with bank feeds and receipt capture, set up correctly from the start. See why cloud accounting software pays off.
6. Protect yourself
- Public liability insurance, and professional indemnity if you give advice or design.
- Workers compensation once you employ anyone.
- Income protection for yourself; if you can’t work, the business stops. See personal insurance explained.
- Written terms and conditions or contracts with customers and suppliers.
7. Plan for tax
Nobody withholds tax from business income. Set aside a percentage of every payment, plus GST if you’re registered, in a separate account. After your first tax return, the ATO may put you into PAYG instalments, paying towards next year’s tax quarterly. The first year is often when people get caught out: tax on year one arrives at the same time as the first instalment for year two.
8. Super for yourself
Sole traders and partners don’t have to pay themselves super, but retirement still comes. Personal contributions can be tax deductible. If you’re a company director, the company pays your super guarantee like any employee.
9. Keep records from day one
Every invoice, receipt and bank transaction, with receipts attached in your software. See how to keep accurate business records.
10. Watch the cash
Invoice straight away, chase overdue accounts, and review cash weekly. Profit and cash are not the same thing. See profitable but cash poor?
11. Get the right help early
An accountant at the start costs far less than fixing problems later. Our first consultation is free, business setup is a fixed fee, and our Sole Trader package is $80 + GST a month, covering your tax return, a tax planning meeting and phone support from day one. See business tax and accounting.