How to Register a Company in Australia
How to Register a Company in Australia: Everything You Need To Know
Why register a company in Australia?
Call us today on 0398320660 to get in contact with a business consultant.
Company registration in Australia involves setting up a company as its own legal entity, which lets you conduct business throughout Australia.
You can also make use of other privileges, such as corporate tax rates or limited liability.
What are the requirements for company registration in Australia?
Step 1: fill in a company registration form at Company123
Step 2: receive all company documents within minutes, sign and file
Step 3: recieve ABN, TFN and GST registration (if necessary) and begin operations
Benefits of Registering a Company?
In Australia, the most common types of company are:
'proprietary limited' companies (cannot raise money from the general public through share issues)
'public' companies (usually formed to raise or borrow public money by listing the company's shares for trading on a stock exchange).
All companies are governed by the Australian Securities and Investments Commission (ASIC), which administers the Corporations Act 2001 (Commonwealth) and other legislation. Public companies must also comply with the rules of the Australian Stock Exchange.
Advantages of a company include that:
• Liability for shareholders is limited. As a general rule company carries legal and commercial risk as a separate legal entity which is seperate entity to the shareholders / directors that
control the company
• it's easy to transfer ownership by selling shares to another party. Simple transfer forms can be completed to transfer the company shares to a new shareholder.
• shareholders (often family members) can be employed by the company with flexible income tax rules on distribution of income. Enjoy the use of tax credits company pays which
may be passed on to shareholders (i.e no double taxation on company profits in the hands of shareholders in most cases)
• the company can trade anywhere in Australia. A Private company can also trade in Overseas jurisdictions. Please consult your tax professional for additional tax advise.
• taxation rates can be more favourable then personal individual tax rates. Private companies currently enjoy a flat 27.5% tax rate where annual turn over of a company is less than $50m.
• Enjoy access to Research & Development and Export Development Grant concessions which are generally availabl only to Pty Ltd companies (not sole traders)
Disadvantages of a company include that:
• the company can cost more to establish, maintain and wind up then a sole trader business
• the reporting requirements can be more complex, however the general advantages of a company often outweigh the additional compliance fees associated in running a company
• your financial affairs of the company are governed by ASIC and information about directors and shareholders can be viewed by public.
• if directors fail to meet their legal obligations, they may be held personally liable for the company's debts including profits distributed to shareholders are taxable. However tax credit
that company pays may be available to the shareholders.
Setting a private company is east. Visit www.company123.com.au website where you will find useful links and information to register a company in under 5 minutes. Company123 offers simple all inclusive solution whether you a business owner setting up a business or you run an accountancy or legal practice and set up companies for Clients. Our support line is open 24/7 if you have any questions and we are always here to help and assist you with any of your questions.
What information is needed to register a company online?
For online registration, you will need to provide the following information:
For Directors & Secretaries: Full name, full residential address as well as the date and place of birth of each person
For Shareholders: Full name, address and number of shares for each shareholder of the company.
General Information: The address of the registered office and principal place of business.
You must get written consent from the people that will fill these roles:
• Director (must be over 18)
• Secretary (must be over 18)
• Member (every company must have at least one member).
Who can register an Australian company?
Anyone can, however you must have at least one director that resides in Australia and a physical Australian address for the registered office of the company. If none of the directors are eligible to work in Australia you will be able to register a company but you may not be able to trade.
If in doubt we recommend that you discuss your needs with an accountant or solicitor for professional advice. Company123 provides free consultations if needed and over the phone advice within business hours of 9-6pm at 03 9832 0660.
In terms of providing Australian directorships, Company123 cannot provide a registered office service or resident director service to international applicants. To find some providers do a search for 'resident director service Australia'.
How can Company123 register my company for me?
We are an ASIC registered agent, agent no. 34511.
ASIC registered agents can lodge documents including company registrations on behalf of third parties.
We are also an ASIC accredited software provider. This means we have our own direct electronic link to ASIC, allowing us to lodge your registration at any time of day, any day of the week.
To get started with your company registration, fill in our online form.
For some more information on the registration process see the ASIC website.
What are your obligations as an officeholder?
If you're an officeholder of a company, you must follow the requirements in the Corporations Act. This includes meeting your legal obligations , which includes:
• ensuring company details are kept up to date
• maintaining company records and details on the register
• paying the appropriate lodgement fees and annual review fees as required.
Officeholders are ultimately responsible for a company's adherence to the Corporations Act. See the ASIC website for more.
A company can be formed with one person, as a proprietary company limited by shares can have one director and one share member who may be the same person.
What costs are involved in the registration of a company?
The total fee is $532 which includes all government fees, our service fee and GST. The ASIC registration fee is $495 and our service fee, inclusive of GST, is just $37.
For $37 you get the convenience of being able to lodge your company 24/7 from the comfort of your own home/office, and also having all your company documentation such as consents, share registry, opening minutes etc automatically prepared for you.
ASIC also charge an annual fee on the anniversary date of registration, ie if you registered a company today the annual fee would be payable in one years time. Annual fees vary depending on the type of company, they can be viewed on our ASIC fee page.
Optional extras include:
For an extra $50, Company123 as registered tax agents will apply for ABN, TFN and GST for your company.
For an optional $55 extra Company123 will also print, bind and deliver your documentation.
Who can be a shareholder?
Individuals and shareholders can be shareholders of your company.
A trust cannot own shares in a company because the law says a trust is not a separate legal person. For example, the 'John Smith Family Trust' cannot own shares or any other property.
Even so, the trustee of a trust, in his, her or its capacity as trustee, is capable of owning shares and other property.
Therefore, a trustee or a corporate trustee can own shares in a company - as long as you include the trustee's name and their capacity. In these cases, the trustee holds the shares in the company on trust for the beneficiaries of the trustee's own trust.
What is a Public Officer?
Under Australian taxation law, every company carrying on business or earning income from property in Australia must have a public officer – unless the company is specifically exempted.
The company decides who acts as public officer in accordance with its Constitution.
The company must appoint a public officer within 3 months of the company:
• commencing to carry on business; or
• first earning income in Australia.
If a company fails to appoint a public officer within the 3 month period, it is guilty of an offence for each day it does not have a public officer.
The public officer must be at least 18 and must live in Australia. They must also be capable of understanding the nature of their appointment.
The public officer deals with the Australian Taxation Office (ATO) in relation to the company's tax affairs and is responsible for ensuring that the company pays the correct amount of tax.
If a company is in default, then the public officer is liable to pay any penalties.
However, the public officer is not personally liable for payment of tax due by the company with the exception of certail liabilities such as supernnation payments due by a company and when it is not paid, Directors may be personally liable for unpaid superannuation of the company. Additionally certain Pay As You Go (PAYG) Withholding obligations in relation to tax withheld on employees wages, directors may be personally liable if the company does not remit the liability to the Australian Taxation Office in timely and due manner. With the exception of these liabilities all other debts of the company generally stay with the company unless the directors personally guarantee obligations to pay the debt for the company.
What name should I use for my company registration?
A company name is not compulsory.
The name of your company can be its Australian Company Number (ACN), the unique number automatically given to a company by ASIC when it’s registered. You can select to use the ACN as your company name when you complete your application and you won’t have to nominate a name.
This is done using Company123's online form by:
Choosing "No" to the question of whether you have a proposed company name.
In terms of picking your company’s name, it cannot be identical to an existing name.
You can check the database easily on the Company123 homepage.
If you are the holder if an identical name, you may be able to register the name for the company in some cases:
• If you are an individual business name holder, you must be a proposed company director or member
• If the business name holder is a company, the same company must be a proposed member
• If the business name holder is a partnership or a joint venture, each of the partners must be a proposed company director or member
• If the business name holder is a trust, each of the trustees must be a proposed company director or member, and you have to provide ASIC with a copy of the trust deed.
During company registration in Australia, names can also be rejected for the following reasons:
• Contains certain words and phrases that cannot be used without the approval of a government minister
• These include bank, trust, Royal, Incorporated
• The name is considered offensive or suggests illegal activity
What is an ACN used for?
If your business is a company, then you'll need an ACN. By law, an ACN must be shown on a number of documents, including:
- accounting statements, such as invoice any documents you lodge with ASIC
- receipts (if they're not machine generated, e.g. from a cash register)
- orders for products and services
- business letterheads
- official company notices
- cheque, or any documents that represent a legal amount of payment
- written ads making a specific offer that can be accepted (such as by completing an order form)
If your company also registers for an ABN, then your ACN will form part of your ABN. In these cases, you won't need to display your ACN if your documents already display your ABN and company name.
You are automatically given an ACN when you register a company.
What is an ultimate holding company?
A company is an ultimate holding company of a wholly-owned group if it has a subsidiary and the company is not a subsidiary of another company. This means, the ultimate holding company owns or controls more than 50% of the shares in the subsidiary and can be referred to as the "controlling entity".
The key element is control. One company controls a second company if it has the capacity to determine the outcome of the decisions of the second company's financial and operating policies.
The ultimate holding company may have a number of subsidiaries.
When should a company apply for an Australian Business Number (ABN)?
ABNs are not compulsory. However, there are many good reasons to have one, for example, ABNs help you:
- to deal with the ATO;
- in dealing with other businesses when supplying goods or services to them, or when purchasing goods and services.
- confirm your business identity to others when ordering or invoicing
- avoid Pay As You Go (PAYG) tax on payments you receive.
- claim energy grants credits
- obtain an Australian domain name
Also, you need an ABN to register for GST. Entities carrying on an enterprise in Australia with a GST turnover of $75,000 must register for GST.
More information can be found at ato.gov.au.
To obtain an ABN, your company must:
• be carrying on an enterprise in Australia;
• in the course of carrying on an enterprise, make supplies connected with the indirect tax zone or have undertaken sufficient activities to commence an enterprise; or
To find an ABN:
If you want to look up information about a registered ABN, such as to check that your details are up to date or check the details of a supplier, you can do this on the ABN Lookup website. ABN Lookup allows you to search publicly available information supplied by businesses when they register for an ABN.
You can find the Australian Business Registry here
What is GST?
Goods and services tax (GST) is a tax of 10% on the sale (supply) of most goods and services consumed in Australia. In general, an organisation that is required by law to 'register' for GST purposes:
• is required to pay GST to the Australian Taxation Office (ATO) if it sells something (ie, goods, services), and
• can claim an 'input tax credit' from the ATO for the amount of GST included in the price of goods and services it purchases.
Your organisation may be required by tax laws to pay GST on any goods and services it supplies.
For further information see the ATO website.
Do I need to cancel my ABN?
If you're closing your business, or changing your business structure, it's likely you'll need to cancel your ABN.
You'll need to cancel your ABN when changing from a:
Sole trader to a company
sole trader to partnership
partnership to company.
If your business is no longer operating you need to cancel your ABN on the ABR website.
What happens after your company is registered?
You need to make sure:
• the company's name is on display wherever the company conducts business and is open to the public
• the company's ACN/ABN is displayed on any documents the company publishes
• the company's details are kept up to date
Post Company Registration: Company Amendments
Accordingly to the legal obligations and responsibilities under the Corporations Act, if there are any changes in the company, it’s important that you inform ASIC within 28 days.
To inform ASIC of the changes, Company123 can file on your behalf form 484 simply known as “Changes to your company details” for your company as registered ASIC agent #34511.
Common types of company changes you need to notify ASIC of:
Change of Address:
Register Address; Principal place of business activity; Officeholder’s address; Shareholder’s address
Appoint or Cease officeholders
Appoint or Cease shareholders
Change of name for officeholders or members
Change share structure
Shares transfer
Documents required to be submitted to ASIC within 28 days of the change occurring. Failure to notify ASIC will result in the following late fees applying:
$79 One month late
$329 Over one month late
As a registered ASIC agent, Company123 can assist you in preparing ASIC forms and other compliance documents for submission with ASIC on the same business day. Prices start from $50. Take advantage of Company123 Professional service of Company sercretarial and ease the burden of keeping up to date with ASIC changes to your company details.
Simply click the following Link & complete a short form.
Post Company Registration: De-Registration of a Company
If you no longer require to use a Pty Ltd company, Company123 can carry out official deregistration on your behalf. Deregistering a company means that you no longer have to continue your obligations as an officeholder and company ceases to exist. It might be worthwhile to apply for voluntary deregistration where a company is no longer trading or carrying on a business.
In order to apply for a deregistration of a company with ASIC, the following requirements need to be fulfilled:
all members of the company must agree to deregister;
the company is not conducting a business;
the company's assets are worth less than $1000;
the company has no outstanding liabilities (e.g. debts);
the company is not involved in any legal proceedings;
the company has paid all fees and penalties payable to ASIC.
As registered ASIC agent, Company123 can assist you in preparing all necessary ASIC form and other compliance documents to submit deregistration request to ASIC on the same business day. The cost of the service is $299 + GST (which includes ASIC fee).
Simply click the following Link & complete a short form.
Take advantage of Company123 professional service and order de-registration service today for any of your unwanted companies and save on incurring ASIC annual review fees.
Post Company De-Registration: Company Reinstatement
If your company has been deregistered, Company123 can assist you with the company reinstatement. Reinstatement will restore to the original status of a deregistered company with ASIC. To apply for reinstatement of company ASIC, following needs to be fulfilled:
Applicant must have been an officeholder or member of company
Consent of the directors
Pay any outstanding ASIC fee at the time of deregistration including penalties or annual review fee
Company123 can carry out the reinstatement process. Simply click the following Link & complete a short form.