Company, Trust, Partnership and Sole Trader Entities
Business Structures
Your business can be conducted under a number of different structures. We are very familiar with the strengths and weaknesses of each structure type.
From time to time you might like to change structure we can help with this process – we have even prepared a business structure guide to help you better under each type of entity.
Our guide can be obtained here: 
Ellco Group – Business Structures Guide.
Comparison Table
| Sole Trader | Partnership | Company | Unit Trust | Discretionary Trust |
|
| Separate Entity | N/A | No | Yes | No | No |
| Establishment Documentation | None | Partnership agreement | Constitution | Trust Deed | Trust Deed |
| Establishment Cost | Low | Medium | High | High | High |
| Limited Liability | No | No | Yes | Can be if trustee company | Can be if trustee company |
| Complexity | Simple | Simple | Complex | Complex | Complex |
| Distribution of Losses | Individual can use | Partners can use | Trapped in Company | Trapped in Trust | Trapped in Trust |
| Carry Forward Losses | No restrictions | No restrictions | Continuity of ownership and same business test restrictions | Compliance with trust loss rules | Compliance with trust loss rules |
| Income Splitting | No | Limited | Salaries or dividends but PSI rules may apply | Salaries or dividends but PSI rules may apply | Salaries or dividends but PSI rules may apply |
| Streaming of Income | No | No | No | Yes | Yes |
| Interest deduction on return of capital | N/A | Yes | Yes | Yes | Yes |
| 50% CGT Discount | Yes | Yes | No | Yes | Yes |
| Can principal be employed? | No | No | Yes | Yes | Yes |
| Superannuation contributions | Self employed | Self employed | Employer sponsored | Employer sponsored | Employer sponsored |
| Who registers for GST? | Individuals | Partnership | Company | Trust | Trust |
| Who pays tax? | Individuals | Partners | Company | Beneficiary /Trustee | Beneficiary /Trustee |
| Do principals have fixed interest | Yes | Yes | Yes | Yes | No (in most cases) |
| Flexibility | Inflexible | Some flexibility | Inflexible | Some flexibility | Flexible |
Establishing a New Business Entity
Every day we establish business entities. Some useful quick links are:-
- Your business name – is it available in Australia?
- Your business name – is it available on Social Media?
- Your business name – is the domain or website name available?
- Getting those important numbers ABN, TFN etc.
