- Australia has no LLC structure; the proprietary limited (Pty Ltd) company is the usual equivalent for overseas founders.
- A Pty Ltd must have at least one director who ordinarily resides in Australia, even when the company is 100% foreign-owned.
- A Pty Ltd is taxed as a company (25% base rate entity or 30%), not as a pass-through entity like a US LLC.
If you are searching for an Australian LLC, here is the short answer: Australia does not have limited liability companies. Founders coming from the United States often hunt for the same three letters, but the local equivalent is the proprietary limited (Pty Ltd) company. It gives you limited liability and a separate legal identity, and foreigners can own all of it.
When you register an Australian company, though, one local rule catches most newcomers off guard. The gap between a US LLC and a Pty Ltd is not just the label; it changes how you are taxed and who must sit on your board.
Does Australia have LLCs?
Australia does not have a limited liability company structure at all. The term “LLC” belongs to the United States and a handful of other jurisdictions, and it has no direct legal counterpart under the Corporations Act 2001.
Instead, Australia offers the proprietary limited company, written as “Pty Ltd” after a business name. It delivers the outcome most founders actually want from an LLC: the owners’ personal assets sit behind a corporate veil, and the company is a separate legal person that can trade, contract and hold assets in its own right.
The confusion is understandable because both aim at limited liability. The practical difference is that the Pty Ltd is a true company, regulated by the Australian Securities and Investments Commission (ASIC), rather than a flexible hybrid like the US LLC.
What are the main Australian business structures?
Australia recognises four core business structures, and the right one depends on liability, tax and how many people are involved. Most overseas founders land on the company, but it helps to see the full menu first.
- Sole trader: One individual trading under their own name or a registered business name. Simple and cheap, but the owner carries unlimited personal liability.
- Partnership: Two or more people or entities sharing profits, losses and liability. Governed by a partnership agreement and state law.
- Company (Pty Ltd): A separate legal entity with limited liability, its own tax rate and ASIC oversight. This is the closest thing to an LLC.
- Trust: A structure where a trustee holds assets for beneficiaries. Common for family businesses and investment holding, and often paired with a company as trustee.
For a comparison of two trust types founders often weigh up, our guide on the unit trust versus discretionary trust breaks down the differences. The company remains the default for scalable, investor-ready businesses.
TIPIf you plan to raise capital, hire staff or take on commercial risk, the Pty Ltd almost always beats a sole trader or partnership on liability protection and credibility.
Why doesn’t ‘LLC’ translate to Australia?
The label does not translate because Australian corporate law never adopted the LLC concept in the first place. The Corporations Act builds around companies and their directors, so there is no room for a US-style pass-through hybrid.
A US LLC is prized for its flexibility: members can elect how it is taxed, and profits usually flow straight through to owners’ personal returns. An Australian Pty Ltd has no such election. It is taxed as a company, files its own return and pays company tax on its profits.
That single tax difference is why copying a US structure onto an Australian entity rarely works. Trying to force LLC logic onto a Pty Ltd tends to create confusion at tax time rather than saving money.
What do overseas founders usually need?
Most overseas founders need three things: a Pty Ltd company, an Australian resident director and an Australian Business Number. Get those in place and you can trade, invoice and open a local bank account.
The resident-director requirement
This is the rule that surprises people. Under section 201A of the Corporations Act 2001, every Australian proprietary company must have at least one director who ordinarily resides in Australia. You can own 100% of the shares from overseas, but you cannot be the only director unless you live in Australia.
If your sole resident director departs, you have 28 days to notify ASIC and appoint a replacement. Many foreign founders solve this by using a nominee resident director service until they relocate or hire locally.
Registration and tax registrations
You will also need to apply for an ABN, plus GST registration once turnover reaches the A$75,000 threshold. Every director must obtain a Director Identification Number before being appointed.
If your business already operates abroad and you are expanding rather than starting fresh, our explainer on offshore company formation covers how a foreign parent can hold an Australian subsidiary. Larger acquisitions of Australian land or assets may also trigger Foreign Investment Review Board approval.
Governance duties do not stop at the director. If you appoint a company secretary, our overview of company secretary duties explains the record-keeping and lodgement obligations that come with the role.
Pty Ltd vs US LLC: how do tax and liability compare?
The two structures protect owners in similar ways but diverge sharply on tax. Both cap the owners’ liability at their investment, yet only the Pty Ltd is taxed as a standalone company.
| Feature | US LLC | Australian Pty Ltd |
|---|---|---|
| Liability | Limited to members’ contributions | Limited to the value of shares held |
| Taxation | Usually pass-through to members’ personal returns | Taxed as a company: 25% base rate entity or 30% |
| Ownership by non-residents | Generally permitted | 100% foreign ownership permitted |
| Resident-director requirement | None | At least one director must ordinarily reside in Australia |
| Best for | US-based founders wanting tax flexibility | Founders trading in or expanding into Australia |
The 25% rate applies to a base rate entity, meaning aggregated turnover under A$50 million and no more than 80% passive income; all other companies pay 30%. Because the Pty Ltd is not pass-through, profits are taxed in the company first, then again in the owner’s hands when paid as a dividend, though franking credits reduce that second layer.
For fast-growing ventures, the company structure also unlocks concessions and planning that a sole trader cannot access. That is where early tax structuring pays off.
How do you set up an Australian company remotely?
You can set up an Australian Pty Ltd entirely from overseas, without ever boarding a flight. The process is digital, and an ASIC-registered agent can lodge on your behalf.
The core steps are straightforward:
- Choose a company name and confirm it is available with ASIC.
- Appoint at least one director who ordinarily resides in Australia.
- Have every director obtain a Director Identification Number.
- Register the company with ASIC and pay the A$636 registration fee (from 1 July 2026).
- Apply for your ABN, tax file number and GST registration where required.
An annual review fee of A$342 then applies each year to keep the company registered (from 1 July 2026). The whole formation can often be completed within a few business days once your documents and resident director are in place.
How Sleek helps you set up your Australian company
Sleek handles the full Pty Ltd setup for overseas founders, including the resident-director requirement, ASIC lodgement and your ABN and tax registrations. Once you are trading, our accountant services keep your company compliant, and our tax and accounting for startups support helps you structure for growth from day one.
Ready to set up your Australian company from overseas?
Set up your Australian Pty Ltd remotely with local experts on your side.
Prices may vary with current promotions, check the latest on the relevant page.
450,000
businesses worldwide.
from 4,100+ reviews.
Frequently Asked Questions
Is a Pty Ltd the same as an LLC?
No structure in Australia is identical to a US LLC, but the Pty Ltd is the closest working equivalent. Both offer limited liability, yet the Pty Ltd is taxed as a separate company rather than as a pass-through entity. The suffix “Pty Ltd” is protected and can only be used by a registered proprietary company.
Can a foreigner own 100% of an Australian company?
Foreign individuals and companies can own all the shares in an Australian Pty Ltd with no residency requirement for shareholders. Foreign Investment Review Board approval may be needed only when the company acquires substantial Australian land, assets or businesses above set thresholds. Ownership and directorship are separate questions, so full ownership does not remove the resident-director rule.
Do I really need an Australian resident director?
Every proprietary company must have at least one director who ordinarily resides in Australia under section 201A of the Corporations Act 2001. There is no exemption for wholly foreign-owned companies. Founders who do not yet live in Australia commonly appoint a nominee resident director to satisfy the rule.
How is a Pty Ltd taxed compared with an LLC?
A Pty Ltd pays company tax of 25% as a base rate entity or 30% otherwise, and lodges its own company return. A US LLC usually passes profits through to members’ personal tax returns instead. Dividends paid from a Pty Ltd can carry franking credits, which reduce the shareholder’s tax on that income.
What does it cost to register a Pty Ltd with ASIC?
The ASIC company registration fee is A$636 from 1 July 2026, separate from any agent or service fees. An annual review fee of A$342 then keeps the company registered each year. Late lodgement penalties start at A$102 and rise to A$428 if you are more than a month late.
How long does it take to set up an Australian company?
Registration itself can be completed within a few business days once your director details and Director Identification Numbers are ready. Delays usually come from sourcing a resident director or obtaining a Director ID, not from ASIC processing. Planning these steps early keeps the timeline tight.
What is the difference between a Pty Ltd and a public company?
A proprietary company is limited to 50 non-employee shareholders and cannot raise funds from the general public. A public company (Ltd) can list on a stock exchange and has heavier reporting duties. Most overseas founders start with a Pty Ltd because it is simpler and cheaper to run.
