Why Business Structure Matters
Your choice of business structure affects:
- Personal liability exposure
- Tax treatment
- Registration process complexity
- Growth and exit options
- Credibility with participants
Option 1: Sole Trader
Best for: Solo practitioners starting out
Pros:
- Simplest to set up (just need ABN)
- Lowest compliance costs
- Full control over decisions
- Simple tax reporting
Cons:
- Unlimited personal liability
- Harder to separate personal/business
- Limited growth options
- Less professional appearance
NDIS Registration: Straightforward, register as individual
Option 2: Company (Pty Ltd)
Best for: Providers planning to grow, employ staff, or wanting liability protection
Pros:
- Limited liability protection
- Professional credibility
- Easier to bring in partners/investors
- Better for employing staff
- Potential tax advantages
Cons:
- More expensive to set up ($500-1,000)
- Ongoing compliance (ASIC fees, reporting)
- More complex tax reporting
- Director responsibilities
NDIS Registration: Register as company, key personnel need screening
Option 3: Partnership
Best for: Two or more people starting together
Pros:
- Shared resources and expertise
- Relatively simple to set up
- Flexible profit sharing
Cons:
- Joint and several liability
- Potential for disputes
- Complex if partner exits
NDIS Registration: Can be complex, consider company instead
Recommendation by Provider Type
| Provider Type | Recommended Structure |
|---|---|
| Solo allied health | Sole trader initially, consider company as you grow |
| Support worker | Sole trader |
| Support coordination | Company (due to liability) |
| SIL provider | Company (definitely) |
| Plan manager | Company (required) |
