Have you ever thought about developing your tattooing skills into an actual business? In this article, we will go through three essential steps to starting a tattoo parlour business. For more general information on how to start a business, see here.
Definitions
There are two key terms to remember for the purpose of setting up a tattoo parlour business:
- ‘Body art tattooing’ procedure means a tattooing procedure performed for decorative purposes.
- ‘Body art tattooing business’ means a business carrying out body art tattooing procedures.
1. Select a business structure
The three most common business structures used in Australia are sole traders, partnerships and companies. The two most relevant are the sole trader and company structures.
Sole Trader
Starting a business as a sole trader is the most inexpensive and straightforward approach. You must apply for an Australian Business Number (‘ABN’). The benefit of creating a tattoo parlour business as a sole trader is that you can choose what to do with the business’s profits. For instance, you can choose to use the money for personal reasons or to benefit your tattoo business. The drawback to this structure is that the financial burden primarily falls on you, the sole trader. We recommend you reflect this in the business plan.
Company
Alternatively, you may choose to set up your tattoo parlour business as a company, particularly if you intend to hire employees and grow your business. A company is considered a separate legal entity at law which means that if your company goes bankrupt, you will not be personally liable to pay those debts. The flip side to this is that as a company, you have more obligations such as reporting to the Australian Securities & Investments Commission (‘ASICS’). To get an in-depth overview of the most common business structures in Australia, see here.
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2. Apply for a tattooist licence
A tattooist licence allows you to do body art tattooing for a fee or other compensation in NSW. This is separate from the tattoo parlour operator licence which you will need to run a business. In other words, if you, as an individual, would like to tattoo others, you will need a tattooist licence.
3. Apply for a tattoo parlour operator licence
To run a body art tattooing business, you will need to have a valid tattoo parlour operator licence. Even if you operate your tattoo parlour from home, you must hold an operator’s licence. If you operate several tattoo parlours (more than one location), you must apply for a tattoo licence for each location. However, if you run a body art tattooing business as a self-employed individual and perform tattooing procedures on the premise, you will not be required to have a tattooist licence. To apply for a NSW tattoo parlour operator licence, see here.
What if you already have a licence from another state?
Even if you are licensed in a different state, you must apply for the licence to work in NSW. The reason for this is because not all states and territories permit tattoo artist. During the application process, you must complete an application for a tattooist licence and a Notice for Registration of Equivalent Occupation.
When will you not need a licence to perform tattooing procedures?
There are two instances where you do not need a licence to perform cosmetic tattooing procedures:
- if it is for permanent make-up such as eyeliner and eyebrow; or
- if you are a medical practitioner and performing tattooing procedures for medical reasons such as to correct a medical condition.
Penalties
If you operate a tattoo parlour business or perform a tattooing procedure without a licence, heavy penalties may apply. Fair Trading NSW states that the maximum penalties for a tattooist are $5,500 for the first offence and $11,000 for any subsequent violation(s). Corporations can face an $11,000 fine and $11,000 for each day the offence continues.
Need further assistance?
If you require further assistance on how to set up a tattoo parlour business or anything related to starting a business, we recommend you contact our lawyers.
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