Freelancers vs. Sole Traders
- A freelancer is an independent contractor who enjoys flexibility in choosing projects and work arrangements.
- Sole traders run their own business fully and handle administrative and managerial work.
Both freelancers and sole traders need an ABN and register for GST over $75k. Tax obligations differ depending on business structure. Legal status is a key difference, with sole traders’ business being one entity and companies as separate legal entities.
Freelancer or Sole Proprietor?
- Freelancers and sole traders need an ABN and have different tax obligations based on their business structure.
- Legal status distinguishes sole traders, whose business is one entity, from companies that are separate legal entities.
Overall, freelancers provide services independently, while sole traders run autonomous small businesses, each requiring proper registration and compliance with tax laws.