Tax Effective Structure

Tax Effective Business Structure

There are four main business structures used by small businesses.

Sole Trader




Which one of the four main business structures is most tax effective?

It depends on each individual circumstance.

Besides choosing most tax effective structure you also need to examine other features of the business structure to meets your requirement such as: -

  • Asset protection

  • Income allocation/split

  • Business agreements

  • Meeting your legal requirements

Typically, costs and complexity increase as you move from a sole trader to a partnership to a company to a trust.

When starting a business, you may start as a sole trader and you can change structure as your business grows or changes.

But if you set up a right business structure from start, you would not need to go through hassle of changing business name, getting a new ABN, changing banking arrangements and etc later on.

The Comparison table shows the main features of business structures. Click the comparison hyperlink to see the differences.

Also click Advantages and Disadvantages for each business structures.


Every effort has been made to offer the most current, correct and clearly expressed information possible within this site. Nonetheless, inadvertent errors can occur and applicable laws, rules and regulations may change.

These materials on this website are general in nature. It is made available on the understanding that the JH Business Services & Taxation is not thereby engaged in rendering professional advice. Before relying on the material in any important matter, users should carefully evaluate its accuracy, currency, completeness and relevance for their purposes, and should obtain any appropriate professional advice relevant to their particular circumstances.