Sole trader vs company: choosing your business structure
Sole trader, company or partnership? Compare structure, tax, cost and liability for independent NDIS support workers, and learn when a company makes sense.
The three structures you'll hear about
Why almost everyone starts as a sole trader
The trade-offs of being a sole trader
When a company (Pty Ltd) might make sense
What about a partnership?
How structure affects your NDIS provider status
A simple side-by-side
Your practical next step
Frequently asked questions
Do I need a company to be an independent support worker?
No. Almost all independent support workers operate as sole traders with a free ABN. A company is a separate legal entity with setup and annual costs, more paperwork and its own tax return. Most workers only consider one later, once their income is high and stable or they're hiring staff. Start simple and revisit with…
Is a sole trader personally liable if something goes wrong?
Yes — as a sole trader you and your business are the same legal person, so there's no corporate shield between business activities and personal assets. That's exactly why public liability and professional indemnity insurance matter so much. For most independents, good insurance is the real protection, not a company…
When should a support worker switch to a company?
Consider it when your income is consistently high and stable, when you want limited liability, or when you're hiring staff and scaling beyond solo work. A company has setup and ongoing costs plus more admin, so the benefits need to clearly outweigh that. Always run the numbers with an accountant before switching.
Can I change from sole trader to a company later?
Yes. Many workers start as a sole trader and move to a company once they outgrow it. You can set up a company, transfer your business activities across and update your ABN details. It's a normal progression, which is another reason there's no need to start with a company on day one.
Does my business structure affect which NDIS clients I can support?
No — that's determined by whether you're a registered or unregistered provider, not by being a sole trader or company. Most independents are unregistered, so they can support plan-managed and self-managed participants but not NDIA-managed ones. Setting up a company doesn't change that on its own.