Doing business in Australia as foreign freelancer located overseas

Question

I am currently located in Germany and do not have permanent residency nor citizenship in Australia. I have potentially been offered a contract with a company in Australia. I will stay in Germany during the time I work on the project (apart from 1 or 2 trips to Australia for meetings).

I wondered if I need to register my business in Australia, as I am physically not there and I don't sell material goods, but an intellectual research outcome.

I am a partner in a partnership (consisting of several freelancers) in Germany. If registering was required would it be easier as a partnership than as a single freelancer?

It boils down to this question: Would anybody know of good and detailed online ressources about the steps I have to take to properly do business in Australia as a small business?

Answer 1

As mentioned in other answers, you may not need to register your business in Australia just to deliver work to an Australian client. However, if you wish to, the steps are:

1) Register the business in order to get an Australian Business Number. The ABN is required for a variety of business-related operations such as opening bank accounts and issuing Tax Invoices. There is provision for ABNs to be issued to foreign companies who are doing business in Australia.

2) If you want to incorporate in Australia (rather than just have an ABN issued to your existing business), there are a variety of other requirements, which for your purposes would be purely administrative. You will need an Australian address - you may wish to use a virtual office supplier, such as Regus. For the process of incorporating, I used ClearDocs - a fully online business incorporation service, which cost around $600AUD. Most of that money goes towards registration fees required by the various government departments.

3) You may choose to register for GST with the Australian Tax Office (ATO). Companies which turn over more than $75,000 per year must register for GST, but even if you don't turn over that amount, you may choose to register. The benefit of GST registration is that you can charge GST to your customers and claim back GST credits on your business purchases.

4) Optionally, you may want to open an Australian bank account. This will reduce the administrative complexity for your customers to pay you, as they will be able to pay to an Australian account in Australian dollars.

5) Understanding the requirements for issuing Tax Invoices within Australia. This is the mechanism by which most companies interact financially and if you are freelancing, almost certainly the mechanism your customers will be expecting.

6) Engage an Australian accountant. There are approaches you can take to how you structure your business and how you collect and report your tax which you will need assistance with. You'll need to understand your Business Activity Statement (BAS) and other annual reporting requirements.

Answer 2

If you DO NOT live in Australia, and DO NOT have an Australian Bank, then there's no reason why you need to pay tax here. Ok, so your client is located here in Australia, however, isn't your own country's tax enough? Your client is the one that has to pay Tax, not you. Perhaps this link might help: Australia caught out by Freelancer.com

At law the payer is supposed to withhold 46.5 per cent and send this to the ATO. A person doing exactly the same work living overseas does not have this restriction.

Answer 3

Australia is very tough on their immigration policies. It depends what type of visa you get, for example if you get a tourist visa I believe it states you must not work. There are plenty of Work Visas which are easy to get hold of if you are from the UK, it may well be the same if you are from Germany.

As for registering your company, I doubt this as long as the authorities know you are working. I would also say unless you have a stack load of cash in the bank (or they have a real shortage of people in your industry) they won't let you start your own business straight away. With regards to partnerships, I would say no - this will just complicate it

This page has a "What Visa you Need" search box: http://www.immi.gov.au/Visas/Pages/Find-a-visa.aspx

A little bit extra

Although this isn't in direct response to your question it maybe helpful to know that

• Australia is very tough on immigration, don't do it right they will turn you away at the gate. So make sure you have all your documents, including written confirmation from the company that you are going to complete work for that you are indeed doing that.
• Take a bank statement. It is most likely rare but when my sister went there they wanted to know how she was going to support herself in case her work fell through, could she manage. Bank statement is easy proof
• Don't take travellers cheques, they are a pain in the a***
• Want to extend your stay longer? No problem, please leave the country first. On most Visas you get one renewal, which must be submitted while you are out the country, so Auckland is filled with travellers who want a couple more months while they submit their visa. Oh and on some extensions you have to do 3 months agricultural work to be granted it. In short: When you are planning apply for the longest possible time you think you will be there.
• You may well know this: Australia gets hot, very hot. If you are working in a northern territory then make sure you have air conditioned workspace sorted or you will do no work. If you are in Sydney then take this into consideration although it's not as bad you wouldn't be enjoying it much. I went in their winter and my poor British climatisation didn't like it.

It has been 2 years since I had to do this research so something might have changed and don't let me put you off Australia is a fantastic place to go to. And if you have a few days go to Queenstown in NZ it is the most beautiful place I have ever been.

Moral of the Story

Plan it out well.