Businesses that operate in Australia enjoy one of the world’s wealthiest economies, stable governments and favourable corporate legal and tax environments. Not only are business stakeholders protected by well-defined regulatory practices, but the educated workforce and easy access to the Asia-Pacific region also make Australia a prime opportunity for new and expanding businesses.
The process of setting up a company in Australia is relatively straightforward, but there are a few things you need to know before you begin moving your business to our shores.
Make Company Decisions
Every company needs to make a few basic decisions before they begin establishing their presence in Australia:
- Company Structure – Australian companies can choose from several legal structures. The most common types of businesses are Sole Traders, Partnerships, Trusts and Companies. If your business is expanding to Australia then you will likely register as a public or private Company.
- Company Name – Your company’s name cannot be the same as an existing registered company, and some words, phrases and characters cannot be included. Your company name is required to include terms such as ‘pty’ and ‘ltd’ that show its legal status.
- Business Name – A business name is optional, but it allows your company to trade under a name other than its Company Name.
- Company Constitution – Your company will need a set of rules that govern how it operates. The Australian Government supplies a basic set of replaceable rules that can be used, or companies can supply their own constitution.
- Obtain Consent from Officeholders – The Australian arm of your business will need local officeholders. At a minimum, you will need written consent from one Resident Director, but some company structures may require additional Directors and Secretaries.
Register Your Company
Once you know how to structure the Australian arm of your business you can move on to registration. You will need to apply for the following:
- Tax File Number (TFN) – Unless you are operating as a Sole Trader, all Australian businesses need to register for a TFN before they begin operating.
- Australian Business Number (ABN) – An ABN is tied to your TFN and it helps the government track business income and tax payments. Applying for an ABN is free.
- Australian Company Name (ACN) – When registering as a company with the Australian Securities and Investments Commission (ASIC), your company will be issued a unique ACN. Your ACN is used frequently and will need to appear on a range of company documents.
- Company and Business Names – Finally, you will need to register your company and business names. The Australian Government offers several online tools for checking the availability of your chosen names.
Ensure You Comply With Tax Regulations
Australia is an attractive market for many companies wanting to expand internationally, but local tax laws are only favourable if your business complies properly. You will need to apply for the following:
- Goods & Services Tax (GST) – GST is a 10% value-added tax that is applied to all goods and services sold in Australia. Any business that makes over $75,000 AUD is required to register for GST.
- Pay As You Go (PAYG) – PAYG is a tax that businesses withhold from payments they make such as an employee’s wages or salary.
- Fringe Benefits Tax (FBT) – Fringe Benefits are any non-wage benefit paid to employees, such as a company car or mobile phone. Fringe benefits need to be recorded for your company and employees’ tax purposes.
Bringing Your Business to Australia? Contact Australian Corporate Governance For Help!
Australia is an attractive market for many multinational and global companies. Favourable legal and tax conditions, along with an educated and wealthy population, makes the country ideal grounds for expansion. But it is important your business complies with all legal and tax requirements. If you would like help to navigate setting up the Australian arm of your business, Australian Corporate Governance is here to help. Our network of consultants has the contacts and experience to get your business up and running sooner, with full confidence that you are operating within Australia’s rules and regulations. Get in touch with us today to learn more.