How to register a company in Australia, a step-by-step guide

You have been trading as a sole trader and it has been working, until now. A co-founder wants to come in with you, a major customer is asking you to sign a long-term contract, or you are simply tired of the thought that every debt the business incurs is a debt you personally owe. That is the point where most small business owners start looking seriously at incorporation: a structure that lets the business take on its own obligations and survive changes in ownership without the paperwork starting again.

Registration with ASIC creates a separate legal entity. When the process is finished you will have a proprietary company (Pty Ltd) on the national companies register, an Australian Company Number (ACN) and a certificate of registration, and the company will be able to own assets, sign contracts and incur debts in its own name. It is worth knowing what registration does not do. It does not automatically give you an ABN, register you for GST, reserve a business name or open a bank account; those are separate steps you take afterwards. And limited liability only works in practice if you actually run the company as its own entity, with its own bank account, its own records and its own contracts, rather than treating it as an extension of your personal finances.

What you need before you lodge

Most of the work in incorporating happens before you touch the application form. Have these things ready:

Proposed company name: a name that is available on ASIC's registers, or a decision to trade under the ACN instead. You can reserve a name before you register if you are not ready to lodge.
Governance decision: whether the company will rely on the replaceable rules in the Corporations Act 2001 (Cth), adopt its own constitution, or use a mix of both.
Officeholders and members: who the directors, secretary (if any) and shareholders will be, and the share structure.
Director identification number: each proposed director must apply for a director ID before the company is registered. This is the prerequisite that most often trips people up, because it is a separate application with its own identity verification.
Written consents: every proposed member, director and secretary must consent in writing to their role before you lodge.
Addresses and the fee: a registered office address and a principal place of business address, plus the ASIC registration fee. Fees are indexed on 1 July each year and the registration fee has sat around $600 in recent years, so confirm the current amount on ASIC's fee indexation page before you lodge.

Registering your company, step by step

Choose and check your company name

If you want a name rather than trading as "ACN 123 456 789 Pty Ltd", start with the name. A proprietary company's name ends in "Pty Ltd". Check that your proposed name is not identical or too similar to a name already on ASIC's registers, and consider whether it clashes with an existing trade mark before you invest in branding. If you have settled on a name but are not ready to register the company, you can lodge Form 410 to reserve the name for up to two months for a fee. Reapply if you need longer; ASIC does not hold names indefinitely. If brand protection matters to your business model, a trade mark application can sit alongside the registration rather than waiting until later.

Decide how the company will be governed

Every company needs rules for how it is run. Under s 134 of the Corporations Act 2001 (Cth), a company's internal management can be governed by the replaceable rules in the Act, by a constitution, or by a combination of both. The replaceable rules are the default for companies registered after 1 July 1998 under s 135, and they cover basics such as how directors' meetings operate and how directors exercise the company's powers. They are generic, however. A constitution lets you set the rules that matter for your situation: how decisions are made, what classes of shares exist and what rights they carry, how disputes between owners are resolved, and what happens if a director or member wants to leave. Once adopted, the constitution and any applicable replaceable rules operate as a contract between the company, its members and its directors under s 140, so the drafting is worth getting right at the start.

Appoint your directors and secretary

Under s 201A of the Corporations Act 2001 (Cth), a proprietary company must have at least one director and that director must ordinarily reside in Australia. A secretary is optional for a proprietary company under s 204A, but if you appoint one, at least one secretary must ordinarily reside in Australia. Each proposed director needs a director ID obtained through the Australian Business Registry Services before the company is registered, and each director and secretary must consent in writing to the appointment. Decide who fills these roles before you lodge, because changing officeholders after registration means further ASIC lodgements.

A company needs at least one member under s 114 of the Corporations Act 2001 (Cth), and the same person can be the sole director and sole shareholder of a proprietary company. Decide how many shares you will issue, to whom, and in what classes. Most early-stage companies issue ordinary shares to everyone, but you can create classes of shares with different rights over dividends, voting or what happens on a sale, which becomes relevant if you bring in investors later. If founders are joining at different times or you want ownership to be earned over time rather than handed over on day one, vesting arrangements can be documented in a shareholders agreement. Each proposed member must consent in writing, confirming the number and class of shares they will hold and the amount they will pay for them.

Collect consents and identity details

The application itself is detail heavy. Under s 117(2) of the Corporations Act 2001 (Cth), it must state the type of company, the proposed name (unless the ACN is used), the name and address of each person consenting to become a member, and for each consenting director and secretary their given and family names, all former names, date and place of birth, and address. You will also provide the registered office address and the principal place of business address, which can be the same place. Gather this information from everyone involved before you start the form; chasing a former name or a place of birth mid-application is where momentum stalls.

Lodge the application with ASIC

Under s 117(1) of the Corporations Act 2001 (Cth), a person lodges the application with ASIC. For most companies this happens online through the Business Registration Service, which is the default pathway. ASIC charges a registration fee at the point of lodgement, indexed each 1 July. Once ASIC processes the application and registers the company, it appears on the companies register, and if you used the Business Registration Service you receive a confirmation email with the ACN and a certificate of registration. ASIC sends the corporate key to the company's registered office address; you will need that key to access the officeholder portal and manage the company online, so make sure the registered office address is one where mail is actually collected. Online registration through the Business Registration Service is not available in every case: for example, if you need to hide a director's residential address from the public register, or for certain company types, ASIC sends a paper form instead. Most applications are processed quickly when everything is in order, often within a day or two, but leave room for the process to take longer if ASIC needs to review something.

Apply for your ABN and register for GST

The company's ABN is a separate application through the Australian Business Register. If the company will trade, apply for the ABN as soon as the company is registered; you need an ABN before you can register for GST. GST registration is compulsory once the company's GST turnover reaches $75,000 or more, and you must register within 21 days of becoming required to do so, although you can register voluntarily before that if you want to claim input tax credits. Your accountant can advise on which other registrations apply, such as PAYG withholding if the company will employ staff.

Set up your registers and records

From day one the company must keep its own records. Under s 168 of the Corporations Act 2001 (Cth), a company must set up and maintain a register of members, and under s 251A it must keep minute books recording directors' and members' resolutions. Your records should also hold the consents given at registration, share certificates, and any later transfers. The share register must always reflect reality, because it is one of the first documents an investor, lender or buyer will ask to see, and ASIC will expect it to be accurate when you file the annual review.

Open a company bank account

Open a bank account in the company's name as soon as practical and move all business income and expenses through it. This is not just tidy bookkeeping. A separate account is the simplest way to show that the company is genuinely operating as its own entity, which is what preserves the separation between company debts and your personal assets. Banks will want to see the company's ACN and certificate of registration, and typically the ID of the directors who will operate the account.

Put execution and sign-off processes in place

Decide early how the company will sign contracts. Under s 127 of the Corporations Act 2001 (Cth), a company can execute a document without a common seal when it is signed by two directors, or by a director and a company secretary, or, for a proprietary company with a sole director, by that director if they are also the sole secretary or the company has no secretary. Electronic signing is available for this kind of execution. A simple written policy setting out who can sign what, and in which combination, prevents the situation where a contract is held up because the right people are not available, or worse, signed in a way that leaves its enforceability in doubt. The board can also authorise a specific person to sign on the company's behalf, but that authority should be recorded in a resolution.

Where applicants get held up

Most applications that stall do so for a small set of recurring reasons:

Director ID not applied for first: The director ID application involves its own identity verification and can take time, yet it is a precondition to registration. Apply for it before you start the company application, not after.
Consents treated as an afterthought: Members, directors and secretaries must all consent in writing, and the application is not complete without them. Collect signed consents when you collect the identity details.
Name clashes discovered late: A name that is identical or too similar to an existing name will be rejected, and a trade mark conflict can be worse because it surfaces after you have started trading. Check availability before you build any branding around the name.
The registered office address is wrong: The corporate key and ASIC's notices go to the registered office. If no one collects mail there, you can miss the corporate key and, later, the annual review notice.

When you need a lawyer's help

Registration itself is a form you can complete, but several parts of the process benefit from legal input before you lodge. A lawyer can help you decide whether a company is the right structure at all, rather than a trust or staying as a sole trader, and can weigh liability, tax and succession issues. They can draft the constitution so it reflects how you actually intend to make decisions, prepare a shareholders agreement that deals with ownership, exits and disputes between co-founders, and design share classes or vesting arrangements before the shares are issued. They can also review the consents and application before lodgement to reduce the chance of a rejection, lodge on your behalf, and troubleshoot if ASIC queries something. After registration, the same lawyer can sequence the follow-on work: the ABN and tax registrations, contracts with customers and suppliers, employment agreements, and the execution policy, so the company starts trading with its paperwork in order. They can also brief the directors on their ongoing duties, including the care and diligence obligations in s 180 of the Corporations Act 2001 (Cth) and the protection of the business judgment rule in s 180(2).

Why the preparation sets the pace

The step that decides whether your incorporation goes smoothly is not the lodgement, which ASIC usually processes quickly, but the preparation that feeds into it. The director IDs, the signed consents and the identity details are the parts that take real time, because they depend on other people, and an application missing any of them cannot be completed. If you gather those before you sit down to fill in the form, the whole process can be done in days; if you start the form first, you will spend the same days chasing signatures and documents while the application sits unfinished.

The essentials to remember are that incorporation creates a separate legal entity that can limit your personal exposure, that most of the work happens before lodgement in the form of decisions about the name, governance and share structure, and that registration is only the beginning. After ASIC issues the ACN you still need the ABN, any tax registrations, the company's own bank account, its registers and records, and a clear process for signing contracts, followed by the annual review and other ongoing obligations on the companies register.