- Most of the work happens before you lodge anything with ASIC.
- Every director needs a free Director ID before they can be appointed.
- At least one director must ordinarily live in Australia.
- Your company needs its own ABN and TFN, even if you're already a sole trader.
Knowing how to start a company in Australia is mostly about making decisions in the right order: structure, name, people and rules first, paperwork second. The lodgement itself is quick once those choices are made, and it’s the part a company registration service can take off your hands. This guide walks through starting a company in Australia step by step, then covers what you owe ASIC and the ATO once your company exists.
What are the steps to start a company in Australia?
These are the eight steps to start a company, in the order most founders work through them:
- Confirm a company is the right structure for your business.
- Choose a company name ASIC will accept.
- Appoint your directors and shareholders, and get their Director IDs.
- Decide between the replaceable rules and a constitution.
- Prepare your details and lodge the application with ASIC.
- Set up your ABN, TFN, GST and PAYG withholding.
- Open a company bank account and set up your records.
- Check licences, insurance and payroll before you trade.
Steps 1 to 4 are decisions only you can make, and they’re where most delays start. Step 5 is mostly data entry once they’re settled.
Step 1: Is a company the right structure for your business?
A company is a separate legal entity, so it owns its assets, signs its contracts and carries its own debts. Most small businesses choose a proprietary limited (Pty Ltd) company, which limits each shareholder’s liability to any amount unpaid on their shares. The trade-off is more admin than any other structure.
A company pays 25% tax if it’s a base rate entity, which means aggregated turnover under A$50 million and no more than 80% passive income; otherwise it pays 30%. If you’re still weighing it up, our comparison of a sole trader vs company sets out the tax and liability differences, and this explainer on what Pty Ltd means covers how a Pty Ltd company works day to day.
Step 2: How do you choose a company name ASIC will accept?
Your company name must end with “Pty Ltd” or “Proprietary Limited” and can’t be identical to a name already on the register. Some words, such as “bank” or “university”, need approval before you can use them.
Before you settle on a name, check that:
- it isn’t identical to an existing company name, or to a business name held by someone else
- it doesn’t clash with a registered trade mark (search IP Australia’s trade mark register)
- you can get a matching domain name and social handles
You can also skip the name and use your ACN instead, for example “ACN 123 456 789 Pty Ltd”. If you’ll trade under a brand that differs from the legal name, you’ll need to register a business name as well, which costs A$47 for one year or A$108 for three.
Step 3: Who will be your directors and shareholders?
A Pty Ltd company needs at least one director and one shareholder, and the same person can hold both roles. These are the minimum requirements:
- Directors: at least one, aged 18 or over and not disqualified from managing corporations.
- Resident director: at least one director must ordinarily reside in Australia.
- Shareholders: at least one, which can be a person or another company, and no more than 50 non-employee shareholders.
- Company secretary: optional for a proprietary company. If you appoint one, at least one secretary must ordinarily reside in Australia.
- Written consents: every director and secretary signs a consent to act, and every shareholder agrees to become a member, before you lodge. You keep these on file; you don’t send them to ASIC.
Every director also needs a Director ID before they’re appointed. It’s free, it’s a 15-digit number starting with 036, and you keep it for life, even if you change companies. Our guide on how to apply for a Director ID covers the myID identity check that trips most people up.
If no founder lives in Australia, you’ll need someone who does to sit on the board. Our guide to resident director requirements explains the options.
Step 4: Should you use the replaceable rules or a constitution?
Your company needs internal rules for appointing directors, issuing shares and running meetings. You have three options:
- Replaceable rules: the default rules in the Corporations Act 2001. They’re free and usually fine for a single founder with simple ownership.
- Constitution: your own rulebook. It’s worth it if you have several shareholders, plan to raise capital or want different classes of shares.
- Both: a constitution can switch off or change individual replaceable rules while keeping the rest.
Do you need a shareholders’ agreement too?
A constitution governs how the company runs, while a shareholders’ agreement is a private contract between the owners. It sets out what happens if a founder leaves, how shares are valued and sold, and how deadlocks get resolved. If there’s more than one owner, agree it before you lodge, while everyone is still on the same page.
Step 5: What do you need ready before you lodge with ASIC?
Once steps 1 to 4 are settled, setting up a company in Australia is mostly data entry. You can lodge it through the government’s Business Registration Service, or a registered ASIC agent can lodge it for you.
Have these details ready:
- your company name (or the ACN option) and the state or territory the company will be registered in
- a registered office address in Australia, which can’t be a PO box, plus your principal place of business
- each director’s full name, date and place of birth, residential address and Director ID
- each shareholder’s name and address, the share class, number of shares and amount paid
- whether you’re using the replaceable rules, a constitution or both
- signed consents from every officeholder and member
The ASIC fee for a new Pty Ltd company is A$636 from 1 July 2026. Once the application is accepted, you’ll receive an Australian Company Number (ACN) and a certificate of registration. For everything else you might pay, see our breakdown of what it costs to set up a Pty Ltd.
Step 6: Which tax registrations does a new company need?
Your ACN identifies the company to ASIC, but the ATO needs its own registrations before you can invoice and pay people. You can apply for most of them together through the Business Registration Service once your ACN is issued.
| Registration | Who needs it | Cost |
|---|---|---|
| ABN | Any company carrying on an enterprise in Australia | Free |
| Company TFN | Every company, for income tax | Free |
| GST | Once your GST turnover reaches A$75,000, or earlier if you choose | Free |
| PAYG withholding | Before your first payment to employees, including working directors | Free |
| Business name | Only if you trade under a name other than the company’s legal name | A$47 (1 year) or A$108 (3 years) |
Your company needs its own ABN even if you already hold one as a sole trader, because the company is a different legal entity. Our guide to ABN registration walks through the application step by step.
Step 7: How should you set up banking and records from day one?
Company money has to stay separate from yours. Mixing the two makes bookkeeping harder, and money you take out without the right paperwork can be taxed as an unplanned loan or dividend.
From your first transaction:
- open a bank account in the company’s name, using your ACN, ABN and ID for each officeholder
- connect cloud accounting software to that account so every transaction is recorded
- keep a register of members, plus minutes and resolutions for key decisions
- store financial records for at least 7 years, as the Corporations Act requires
It pays to compare business bank accounts early, since some banks take a few days to verify every director.
Step 8: What licences, insurance and payroll do you need before trading?
Getting your ACN doesn’t mean you’re ready to trade. Depending on your industry and location, check these before you open the doors:
- Licences and permits: food, building, trade and professional services often need state, territory or council approval. Our guide to business licences and permits lists the common ones.
- Insurance: workers’ compensation is compulsory once you employ staff, and public liability or professional indemnity cover is common for client-facing work.
- Payroll: register for PAYG withholding, report pay through Single Touch Payroll and pay super at 12% of ordinary time earnings.
From 1 July 2026, payday super means contributions must reach each employee’s fund within 7 business days of payday, not once a quarter. If you’ll hire in your first year, set up payroll before the first pay run rather than after it.
What ongoing obligations start once your company exists?
Setting up a company in Australia is a one-off job, but the obligations that come with it repeat every year. These are the ones new directors most often miss:
Late lodgement costs A$102, rising to A$428 once you’re more than a month late. Our guide to the ASIC annual review fee covers due dates and ways to pay.
What mistakes slow down starting a company in Australia?
Most problems when starting a company in Australia come from rushing the early decisions. Watch for these:
- Leaving Director IDs to the last minute. You can’t lodge until every director has one, and identity checks take longer if myID doesn’t verify first time.
- Choosing a company for the tax rate alone. The 25% rate only pays off once profits are high enough to outweigh the extra running costs.
- Splitting equity on a handshake. Without a shareholders’ agreement, a founder leaving can turn into a dispute over who owns what.
- Using your home as the registered office by default. That address appears on the public register, so consider whether you want it there.
- Forgetting the first annual review. ASIC sends your first statement a year after registration, and late fees apply if you miss the due date.
How Sleek helps with starting a company in Australia
Sleek’s licensed team prepares your company documents, lodges with ASIC and sets up your ABN, TFN, GST and PAYG in one go, then keeps your annual review and tax deadlines on track. You make the calls in steps 1 to 4 with an expert on hand, and we handle the rest of the steps to start a company. See what’s included in our company registration packages.
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FAQs on how to start a company in australia
Can I move my sole trader business into a company later?
Yes. Many founders start as sole traders and move to a Pty Ltd once revenue or risk grows. The company needs its own ABN, and moving assets or contracts across can trigger capital gains tax or stamp duty, although small business restructure rollover relief may apply. Plan the timing with your accountant, and cancel your sole trader ABN once you stop using it.
Can I start a company in Australia if I live overseas?
Yes. A non-resident can be a director and shareholder, but at least one director must ordinarily live in Australia, and the company needs a local registered office address. Opening a local bank account can also take longer without an Australian presence. Our guide to starting a business in Australia as a foreigner covers visas, banking and foreign investment rules.
What happens if I sign contracts before the company exists?
The company can ratify a contract you signed on its behalf once it’s registered. If it doesn’t ratify within the agreed time, or within 15 months if no time was agreed, you can be personally liable. Where you can, wait for your ACN before signing leases or supplier agreements.
Do I need an accountant to start a company?
No. You can lodge the application and tax registrations yourself. An accountant adds most value on the structure decision, your first BAS and the first company tax return, where mistakes cost more to fix later.
Does a new company have to lodge a tax return if it made a loss?
Yes. Every company lodges a tax return each year, even with a loss or no income. A tax loss can usually be carried forward to reduce future profits, as long as the company passes the continuity of ownership test or the similar business test.
