There are significant differences and legal considerations when it comes to sole trader and company business structures. Sole Trader: A sole trader is a self-employed individual who owns and operates their own business. This is the most straightforward business structure to establish. As a sole trader, you'll need an Australian Business Number (ABN), and if you don't trade under your own name, you'll have to register a business name. In this structure, you and your business are considered one entity, meaning you maintain full control and bear personal responsibility for any debts or losses. Your personal income tax rates will apply to the business. Company: Setting up a company is more complex and involves acquiring both an Australian Company Number (ACN) and an ABN, registered through the Australian Securities and Investments Commission (ASIC). Recognized as a separate legal entity, the company structure has higher setup costs but offers protection against personal liability for losses or debts. This protection means that your personal assets aren't at risk if the company takes out loans or incurs other debts. The company's profits are taxed at the corporate tax rate, and companies must maintain a separate bank account. They are also subject to annual review by ASIC. Both structures have unique benefits and considerations, depending on your business goals and personal preferences. For a more detailed comparison between a sole trader and a company, please here .