Sole Trader, Partnership, Company, or Trust?
The wrong structure can cost you more than tax.
Choosing a business structure isn’t just a formality. It sets the rules for how your business is taxed, protected, and grown.
And getting it wrong? That can cost you thousands, create legal headaches, or make it harder to scale later.
Let’s break down the four main options:
👥 Sole Trader
Easiest to set up
You’re personally liable for everything
Income is taxed at your individual rate
Great for freelancers or side hustles starting small
🤝 Partnership
Two or more people share responsibility and profits
Still personally liable (unless structured under a company)
Can lead to conflict if roles and income aren’t clearly defined
💼 Company
Separate legal entity
Offers asset protection and lower tax rates for reinvested profits
More admin, but ideal for growing or high-risk businesses
👨💼 Trust
Complex but powerful for asset protection and tax planning
Income can be distributed flexibly to beneficiaries
Often used for family businesses or long-term growth strategies
There is no one-size-fits-all.
Your ideal structure depends on:
How much you plan to earn
Whether you have business partners
Your personal risk exposure
👉 What to do next
If you're unsure which structure fits best, don’t just pick the default. It can be expensive to change later.
This is where a good accountant makes all the difference. At HelloLedger, we help you make structure decisions that work for you now—and scale with you later.
Let’s get it right the first time.
Ready to feel more confident with your setup?
Start here: https://www.helloledger.com.au/
—
Leonie Martin
Registered Tax Agent | Business Advisor
Founder of HelloLedger and Hello Tax Talk
Helping business owners simplify tax, manage cash flow, and grow with confidence.
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