The Guides to Social Policy Law is a collection of publications designed to assist decision makers administering social policy law. The information contained in this publication is intended only as a guide to relevant legislation/policy. The information is accurate as at the date listed at the bottom of the page, but may be subject to change. To discuss individual circumstances please contact Services Australia.

1.1.S.225 Sole trader


This definition applies to all payments.


For the purposes of income and assets assessment, a sole trader is a business owned by one person.

The business:

  • is NOT a separate legal entity from the owner
  • is NOT a separate accounting entity, which means that sole traders need ONLY lodge a personal tax return
  • may be run in the owner's name OR under a registered business name, and
  • may or may NOT have employees.

The owner is:

  • liable for ALL the debts of the business, and
  • entitled to ALL the profits of the business.

Policy reference: SS Guide 4.7.1 Assessing the Income & Assets of Sole Traders & Partnerships

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