Quick answer
The cost to start a business in Australia ranges from a few thousand dollars for a home-based service business to six figures for a shopfront with a fit-out. Work it out in three buckets: one-off set-up costs, at least three months of running costs before customers pay reliably, and a cash buffer. Registration is the cheap part. An ABN is free and a company costs $636 to register with ASIC from 1 July 2026.
Key points
- Budget in three buckets: one-off set-up costs, early running costs, and a buffer. Most owners only cost the first.
- From 1 July 2026, ASIC charges $636 to register a company, $342 for the yearly review, and $47 (one year) or $108 (three years) for a business name. An ABN is free.
- business.gov.au suggests being able to cover six months or more of running costs when you start.
- A full-time employee on the National Minimum Wage ($26.44 an hour) costs about $1,125 a week once 12% super is added, before workers' comp and leave.
- Borrow for things that earn or last. Fund the early losses from savings, because unsecured lenders usually want to see trading history first.
Ask ten people what it costs to start a business and you’ll get ten different numbers, usually somewhere between “a few grand” and “more than you think”. Both are true, and neither helps you. The figure that matters is yours, and you can work it out in an evening with a spreadsheet and some honest guesses.
This guide gives you a three-bucket method, the official 2026 fees, three illustrative budgets and a short self-test on how much of the total it makes sense to borrow. The aim is a number you can defend to yourself, your partner, your accountant and, if it comes to it, a lender.
Why most start-up budgets come up short
Most new owners cost the opening: the equipment, the website, the sign, the first stock order. Fewer cost the months after opening day, when bills arrive on time and customers don’t.
That’s why business.gov.au’s start-up costs guidance separates one-off expenses, running costs and assets, and suggests making sure you can “cover 6 months or more” of running costs when you start. It’s also why the coaching method below has three buckets, not one.
The three-bucket method: how much money do you need to start a business?
Bucket 1: one-off set-up costs
Everything you pay once to open the doors:
- Registrations: ABN, business name, company (if you use one), domain name
- Premises: bond, fit-out, signage, utility connections
- Equipment and vehicles: tools, machines, computers, POS, a ute or van
- Opening stock and packaging
- Professional help: an accountant’s set-up advice and a solicitor to review a lease or agreement
- Launch marketing: website, photos and the first round of ads
Bucket 2: running costs until customers pay reliably
This covers rent, wages, insurance, software, phone, fuel, loan repayments and your own drawings. If you’ve left a job, the business has to pay your rent or mortgage too. Count at least three months of running costs. If you’re opening premises, hiring, or selling to customers on 30-day terms, count six.
Bucket 3: a buffer for what you didn’t see coming
Builds run late, suppliers want cash up front from a new account, and the first BAS arrives faster than expected. A buffer of 10–20% of buckets 1 and 2 combined is a sensible coaching starting point. Make it bigger if your plan depends on a fit-out or a single big customer.
Your start-up number = bucket 1 + bucket 2 + bucket 3. Then subtract the cash you already have. What’s left is the gap you need to fill.
What are the official start-up fees in 2026?
Registration is the cheapest part of starting out, but it’s the part people search for most, so here are the current figures. These fees went up on 1 July 2026, according to business.gov.au’s summary of the changes:
| Item | Cost from 1 July 2026 |
|---|---|
| ABN | Free (apply through business.gov.au) |
| Business name, 1 year | $47 |
| Business name, 3 years | $108 |
| Register a proprietary company (ASIC) | $636 |
| Company annual review fee (each year) | $342 |
| GST registration | Free. Required within 21 days of reaching $75,000 GST turnover |
Two things to note. A company has a yearly cost as well as a set-up cost, so put the $342 review fee into bucket 2 of next year’s budget. And if you expect to cross $75,000 in GST turnover, the ATO requires you to register for GST. That changes your pricing, so decide early whether your prices include GST.
How much does a first employee add?
If your plan includes staff from day one, wages are usually the biggest number in bucket 2. From 1 July 2026, the National Minimum Wage is $26.44 an hour, and modern award rates rose by 4.75%.
A quick sum for one full-time employee on the minimum wage:
- 38 hours × $26.44 = about $1,005 a week
- Plus 12% super = about $1,125 a week
- Over 13 weeks = roughly $14,600, before workers’ compensation, leave, payroll software and any award rate above the minimum
Since 1 July 2026, Payday Super means super is paid with every pay run rather than quarterly. In a new business that matters, because there’s no longer a three-month lag to hold that cash. The ATO’s Small Business Superannuation Clearing House also closed on 1 July 2026, so budget for payroll software that handles super for you. Our growth milestones checklist covers what switches on when you hire.
Three illustrative start-up budgets
These are illustrative examples to show the method, not quotes or averages. Your figures will differ by location, industry and how much you already own.
| Home-based bookkeeper | Electrician going out on their own | Small café in a leased shop | |
|---|---|---|---|
| Bucket 1: set-up | Laptop, software, insurance, business name, website: about $5k | Ute, tools, test gear, licence and insurance, company set-up: about $65k | Fit-out, coffee machine, kitchen gear, bond, signage, opening stock: about $190k |
| Bucket 2: running costs | 3 months of costs and owner drawings: about $18k | 3 months, including drawings and fuel: about $30k | 6 months of rent, wages for two staff, utilities and drawings: about $120k |
| Bucket 3: buffer (15%) | About $3.5k | About $14k | About $46k |
| Start-up number | About $26.5k | About $109k | About $356k |
Three things stand out:
- The bookkeeper’s biggest cost is time, not stuff. Nearly all of the budget is living costs while the client list builds.
- The electrician’s ute is most of bucket 1. Equipment like this is the most common thing to finance, because it lasts and earns.
- The café’s running-cost bucket is nearly two-thirds the size of its fit-out. Owners who only cost the fit-out are the ones who run short in month four.
Want to see which funding options line up with your own numbers? The 2-minute funding profile ranks them for your stage and goal. If you already know there’s a gap, you can check your options with a real person at any point.
How to pay for start-up costs: fund it yourself, borrow or wait?
Once you know the gap, work through these coaching questions in order.
1. Which bucket is the gap in? Borrowing fits bucket 1 best, because a vehicle, machine or fit-out lasts and helps earn the repayments. Borrowing to fill bucket 2 means paying back money you spent on early losses, so that’s normally the job of savings.
2. Will a lender have something to lean on? Unsecured business loans are usually sized on turnover and bank statements, so they’re unlikely before you’ve traded. If you or a director own property with equity, a property-secured business loan from $20,000 can fund set-up costs before there’s any trading history. Equipment is often financed against the asset itself. Our which business loan is right for me guide walks through each option.
3. Do the repayments survive your slow start? Add the repayments to bucket 2 and rerun the numbers assuming sales arrive twice as slowly as you hope. If the plan still works, borrowing can speed things up. If it only works on the hopeful version, borrowing just makes the shortfall bigger.
4. Could you start smaller? A second-hand coffee machine, a shorter lease, a part-time start while you keep some employment income. Starting smaller and proving the idea is a legitimate plan, not a failure of ambition.
5. What’s your plan if it takes six months longer? Write the answer down. If it’s “I’d use the buffer”, check that the buffer is actually big enough.
Your quick score
- Mostly yes, with room to spare: you’re funding-ready. Borrowing for set-up assets is a reasonable move.
- A mix: trim bucket 1, grow the buffer, then reassess in a month.
- Mostly no: it’s “not yet” rather than “no”. Save for longer, start smaller, or trade for a few months to build bank statements first.
Common start-up budget mistakes, and what they cost
- Leaving out your own pay. If the business can’t fund your drawings, your personal savings will. Count them as a cost.
- Mixing GST-inclusive and GST-exclusive figures. business.gov.au’s template asks you to label which is which. Mixing them can throw your total out by up to 10%.
- Treating the bond as spare cash. A lease bond or bank guarantee is money you can’t touch for years.
- Forgetting the first tax bills. Once you register for GST, part of every sale belongs to the ATO. Set it aside from week one, or your first BAS will come out of your buffer.
- Spending the buffer on upgrades. The buffer is for problems, not for the nicer fit-out.
- No separate bank account. Clean business statements from day one are what unlock unsecured funding later. See our starting-out hub for the full set-up checklist.
Once you’re trading, keep checking the numbers. Our cash runway guide shows how many weeks of costs your cash covers, which is the best early warning that bucket 2 was too small.
Know your start-up number? Let’s find the right way to fund it
Working out the real cost to start your business is the hard part, and you’ve just done it. If the gap is in equipment, a fit-out or premises, and especially if there’s property equity in the picture, there may be a sensible way to fund it without draining the cash you need for your first few months.
Making an enquiry takes about 60 seconds, and simply asking won’t leave a mark on your credit file, because there’s no credit check when you first enquire. Your details stay with us rather than being sent to a pile of lenders, so your phone won’t light up with strangers. A real person reads what you’ve told us about your plans, your start-up costs and any property, then calls you to talk it through.
Please fill the form in accurately: what you’re starting, roughly what you need and what it’s for. Honest answers mean we can point you to the option that genuinely fits the first time.
Frequently asked questions
How much does it cost to start a small business in Australia?
It depends almost entirely on the type of business. A home-based service business can start for a few thousand dollars plus a few months of living costs. A trade business with a vehicle and tools often needs tens of thousands, and a shopfront with a fit-out, bond and stock can need six figures. Add up one-off costs, early running costs and a buffer to find your own number.
How much money do I need to start a business?
Enough to pay for set-up, cover your running costs until customers pay reliably, and still have a buffer. business.gov.au suggests being able to cover six months or more of running costs. Three months is a sensible minimum if your work pays quickly, but you should aim for six if you're opening premises or hiring.
What is the ASIC company registration fee in 2026?
From 1 July 2026 it costs $636 to register a proprietary company with ASIC, and the annual review fee is $342. Registering a business name costs $47 for one year or $108 for three years. Applying for an ABN is free.
Should I set up a company or a sole trader business to start?
A sole trader set-up is cheaper and simpler: an ABN is free and a business name is optional. A company costs $636 to register plus $342 every year, and needs more bookkeeping, but it separates the business from you personally. It's worth a short conversation with an accountant before you choose, because it's harder to change later.
Can I get a loan to cover start-up costs?
Sometimes. Unsecured business loans are usually sized on turnover and bank statements, so they're hard to get before you've traded. If you or a director own property with equity, a property-secured business loan from $20,000 can fund set-up costs such as a fit-out or equipment. Savings normally cover the early losses.
Are start-up costs tax deductible?
Most business expenses can be claimed, but some are deducted straight away and others over time. Eligible small businesses can immediately deduct eligible assets under the $20,000 instant asset write-off, which is permanent from 1 July 2026. Check the treatment of your own costs with your accountant or the ATO.
Do I need to register for GST before I start?
Only if you expect GST turnover of $75,000 or more, in which case you must register within 21 days. You can register voluntarily earlier. Either way, make sure every figure in your start-up budget clearly shows whether it includes or excludes GST.