Show download pdf controls
  • Are you in business?

    It is important to understand whether you are carrying on a business for tax and other purposes.

    The following video will help you work out whether you are in business yet.

    Media: Are you in business?: Tax basics for small business Link (Duration: 03:19)

    Characteristics of a business

    There is no single factor that determines if you are in business, but some of the factors you need to consider include:

    • You've made a decision to start a business and have done something about it to operate in a businesslike manner, such as
      • registered a business name
      • obtained an ABN.
    • You intend to make a profit – or genuinely believe you will make a profit from the activity – even if you are unlikely to do so in the short term.
    • You repeat similar types of activities.
    • The size or scale of your activity is consistent with other businesses in your industry.
    • Your activity is planned, organised and carried out in a businesslike manner. This may include
      • keeping business records and account books
      • having a separate business bank account
      • operating from business premises
      • having licenses or qualifications
      • having a registered business name.

    If you aren't in business yet, it is important to keep these factors in mind as your activities change or grow, so you'll know when you need to register for tax and other business responsibilities.

    Not carrying on a business

    If you determine that you are not carrying on a business, you may still have tax obligations and need to report the income you earn.

    Find out about:

    See also:

    Last modified: 25 Aug 2021QC 31733