Registering a company in Australia requires following certain procedures and paying associated fees. While costs may vary, there are ways to register your company on a budget. Read about cheap company registration below.
How To Register Your Company In Australia On A Budget
Here is a step-by-step guide to registering a company in Australia while keeping expenses in mind:
1. Decide On Your Company Structure
Choosing the right company structure is an important decision when registering a business in Australia. Here’s a breakdown of the different structures and their cost implications:
Sole Trader:
Registering as a sole trader is the simplest and most cost-effective option. As a sole trader, you operate the business as an individual, and you are personally liable for all business debts. The registration process typically involves obtaining an Australian Business Number (ABN), and there are no separate registration fees for becoming a sole trader.
Partnership:
If you plan to start a business with one or more partners, registering as a partnership is an option. In a partnership, all partners share the profits, losses, and liabilities of the business. Similar to a sole trader, there are no separate registration fees for partnerships. Each partner will need to obtain an ABN, and it is advisable to have a partnership agreement in place, which may involve some legal costs.
Company:
Registering as a company offers limited liability protection, meaning the company is a separate legal entity, distinct from its owners (shareholders). This structure can provide greater personal asset protection, but it does involve additional costs.
The registration process involves submitting an application to the Australian Securities and Investments Commission (ASIC) and paying a registration fee, which is typically around AUD 500 for a proprietary company. You will also need to have a unique company name, and ongoing compliance requirements, such as annual reporting, may incur further costs.
While registering a company is costlier compared to other structures, the legal protection it provides may be beneficial, depending on the nature and scale of your business. It’s advisable to consider factors such as your long-term goals, risk appetite, and growth plans when deciding on the appropriate company structure. Consulting with a professional accountant or business advisor can help you make an informed decision based on your specific circumstances.
2. Choose A Unique Company Name
Choosing a unique and appropriate company name is an important step in the registration process. Here’s a guide on selecting and checking the availability of your chosen company name using the ASIC online search tool:
- Brainstorm and choose a name: Think of a name that aligns with your business and brand. Consider factors like uniqueness, relevance, and memorability. Make sure the name accurately represents your business and isn’t too similar to existing companies to avoid confusion.
- Access the ASIC online search tool: Visit the ASIC website (https://asic.gov.au) and navigate to the ‘Search ASIC Registers’ section. You can find the search tool under the ‘For business’ tab or by using the search function on the website.
- Conduct a company name availability search: In the ASIC search tool, select the ‘Check name availability’ or ‘Search company and other registers’ option. Enter your desired company name in the search field and choose the appropriate search category (e.g., ‘Company Name,’ ‘Business Name’).
- Review the search results: The ASIC search tool will display the results of your search. It will show if the name you entered is available or if there are similar names already registered. Take note of any similar names and consider whether they could cause confusion or infringe on trademarks.
- Refine your chosen name (if necessary): If your desired name is already registered or too similar to existing names, you will need to choose a different name or modify your original choice. Make sure the modified name remains unique and in line with your business vision.
- Reserve the chosen name (optional): If your chosen name is available, but you’re not yet ready to register your company, you can choose to reserve the name for a fee. This will prevent others from registering the same name while you finalize your business plans.
Remember, it’s important to comply with ASIC’s guidelines for company names. The name should not be misleading, offensive, or prohibited by law. Additionally, it’s recommended to check for trademark registrations with IP Australia (https://www.ipaustralia.gov.au/) to ensure your chosen name doesn’t infringe on existing trademarks.
Taking the time to select a unique and suitable company name and verifying its availability using the ASIC online search tool will help you avoid potential conflicts and ensure a smoother registration process for your business.
3. Register For An Australian Business Number (ABN)
Registering for an Australian Business Number (ABN) is an important step in the process of establishing your business in Australia. Here’s a guide on how to register for an ABN through the Australian Business Register (ABR) website:
- Determine your eligibility: Ensure that you meet the eligibility criteria for obtaining an ABN. Generally, you are eligible for an ABN if you are carrying on or starting an enterprise in Australia or if you are required to be registered for the Goods and Services Tax (GST).
- Gather necessary information: Before starting the registration process, gather the following information:
- Your details, such as your legal name, date of birth, and tax file number (TFN).
- Business details, including the proposed business name, business address, and contact details.
- Information about your business activities and the industry in which you operate.
- Details of your associates or partners, if applicable.
- Access the Australian Business Register (ABR) website: Visit the ABR website at https://abr.gov.au.
- Navigate to the registration page: Look for the section related to registering for an ABN on the ABR website. It is usually located under the “Apply for an ABN” or similar category.
- Start the online registration process: Follow the prompts to complete the online registration form. Provide accurate and complete information about yourself and your business. The form may ask for details such as your personal information, business structure, business activities, and the date you commenced or plan to commence your business.
- Apply: Review all the provided information for accuracy and completeness. Once you are satisfied, submit your application.
- Note the reference number: After applying, you will receive a reference number. Make sure to keep this number safe as it will be used for tracking the progress of your application.
- Await ABN issuance: The Australian Business Register will review your application, and if everything is in order, they will issue your ABN. The processing time can vary, but you can usually expect to receive your ABN within a few business days.
Registering for an ABN is generally free of charge. However, note that some third-party service providers may charge a fee for assisting with the application process. It’s recommended to directly apply through the official ABR website to avoid unnecessary fees.
Obtaining an ABN is an essential step for your business, as it allows you to interact with the Australian Taxation Office (ATO), confirm your business’s identity, and facilitate various tax-related obligations.
Remember to keep your ABN details updated with the ABR in case of any changes to your business information.
4. Decide On The Company’s Registered Address
When registering a company in Australia, you need to provide a registered address where official communications and legal documents can be sent. Here’s an overview of the options for choosing a registered address:
Home Address:
You can use your residential address as the registered address for your company. This is a cost-effective option, especially for small businesses or sole traders operating from home. However, it’s important to note that using a home address means your address will be publicly available on the public register, which may affect privacy considerations.
Virtual Office:
A virtual office provides a professional address for your business without the need for a physical office space. Virtual office services typically offer mail handling, call answering, and other administrative support. Using a virtual office can give your company a more professional image while allowing you to work remotely. However, keep in mind that virtual office services come with a fee, which can vary based on the provider and the services included.
- Commercial Space: If you have a physical office or commercial space for your business, you can use that address as the registered address. This option provides a dedicated business location and can enhance your credibility. However, it can be more costly due to rent, maintenance, and other associated expenses.
When choosing a registered address, consider the following factors:
- Privacy: If you have privacy concerns, using a virtual office or commercial space might be preferable to using your home address.
- Professionalism: A registered address contributes to the overall impression of your business. Consider the image you want to portray to clients, partners, and stakeholders.
- Accessibility: Ensure that you can easily access mail and legal documents sent to the registered address or that you have arrangements in place to receive them promptly.
- Legal Compliance: Make sure the chosen address meets the requirements set by ASIC, such as being a physical location in Australia where documents can be delivered during normal business hours.
Remember, even if you choose a home address or virtual office as your registered address, you still need to maintain a physical address for records and contact purposes. This can be your residential address or a separate mailing address.
Before finalizing your registered address, it’s recommended to consult with a professional advisor or legal expert who can provide guidance based on your specific business needs and legal obligations.
5. Prepare The Necessary Documents
Gather the required documents, such as proof of identity for all directors and shareholders, proof of address, and company constitution (optional but recommended). These documents may need to be notarized or certified.
6. Register Your Company With ASIC
Visit the ASIC website and complete the online registration process using the ASIC Connect portal. You’ll need to provide details such as company name, registered address, director details, shareholder details, and share structure. There is a registration fee involved, which is typically around AUD 500 for a proprietary company.
7. Register For Goods And Services Tax (GST) (if applicable)
If your company’s annual turnover is expected to exceed AUD 75,000, you’ll need to register for GST. This can be done during the company registration process or separately through the ABR website.
8. Set Up A Business Bank Account
Open a business bank account in your company’s name. Compare different bank options to find an account with low or no fees, suitable for your budget.
9. Register For Other Required Licenses And Permits
Depending on your business activities, you may need additional licenses or permits. Check with the relevant authorities or use the Australian Business License and Information Service (ABLIS) to determine the permits required for your business.
10. Maintain Compliance
After registering your company, fulfil ongoing compliance requirements, such as filing annual reports, paying taxes, and updating ASIC with any changes in company details.
Conclusion
In conclusion, registering a company in Australia involves several important steps and considerations. By following the recommended process, you can establish your business while being mindful of your budget. Remember to seek professional advice from accountants, lawyers, or business advisors to ensure you meet all legal requirements specific to your business. By following these steps and remaining compliant, you can successfully register your company in Australia on a budget and establish a solid foundation for your business endeavours.