- Keeping a company dormant means it still exists, and you still pay the A$329 ASIC annual review fee and lodge a nil tax return, but you can resume trading any time. Deregistration ends the company and all its obligations, but it is hard to reverse.
- Default rule: deregister if you are genuinely done, and the company holds no assets, IP or reason to exist; stay dormant if you expect to trade again or want to hold the name, assets or intellectual property.
- Deregister cleanly by transferring out all assets first (anything left can vest in ASIC), settling liabilities, and lodging Form 6010 at least two weeks before the next review fee is due.
If you have stopped trading and want to choose between keeping your company dormant or deregistering it, the default is simple: deregister if you are truly finished and the company holds nothing worth keeping, or stay dormant if you expect to trade again or want to hold the name, assets or IP.
Choose dormant if… | Choose deregistration if… |
You expect to trade again | You are genuinely finished |
The company holds valuable IP, assets or a name worth keeping | The company holds nothing worth keeping |
You need time to decide | You want all fees and obligations to stop immediately |
This guide compares the two; for the full close-down process, see our separate step-by-step guide.
Dormant company or deregistration: Which should you choose?
The right choice turns on one question: do you think you will need this company again?
Keep dormant | Deregister | |
Company still exists? | Yes | No |
ASIC review fee | A$329 per year | None after deregistration |
Tax returns | Nil return likely required | None |
Can resume trading? | Yes, anytime | No, must reinstate first |
Holds name/assets / IP? | Yes | No, assets can vest in ASIC |
Reversibility | Fully reversible | Hard; reinstatement is limited |
Dormancy parks the company: it stays yours and can spring back into trading whenever you want, but you keep paying the annual fee. Deregistration closes it for good: obligations and fees stop, but reversing it is slow and uncertain. The sections below explain each option in full, with a clear trigger for each.
What does it mean to keep a company dormant in Australia?
A dormant company is one that still legally exists but is not trading. Australia has no special ‘dormant’ status that switches off your obligations; the company simply continues with no activity. That means it keeps its full obligations under the Corporations Act, including paying the ASIC annual review fee, currently A$329 for a proprietary company, every year on its review date.
On the tax side, if the company has no trading activity, you generally still lodge a company tax return, a nil return, with the ATO each year, and you may want to cancel its GST registration, so the ATO stops expecting activity statements. The appeal of dormancy is optionality: the company, its name, its ACN, and any assets or intellectual property it holds stay intact and ready, so you can resume trading without setting up a new entity. The cost of that optionality is the ongoing fees and filings.
What does deregistering a company involve?
Deregistration removes the company from the register so it ceases to exist as a legal entity. Once deregistered, it cannot trade, hold assets, or lodge documents, and you no longer pay the ASIC review fee or lodge returns. To deregister voluntarily, you lodge ASIC Form 6010, and the company must meet eligibility conditions: all members agree, the company has assets worth less than A$1,000, it has no outstanding liabilities, it is not a party to legal proceedings, and all tax and other obligations are settled. The voluntary deregistration fee is A$50.
Important, and easy to get wrong: transfer out every asset before you deregister. Anything the company still owns when it is deregistered can vest in ASIC or the Commonwealth, and people regularly discover months later that a forgotten bank balance, property or trademark was lost this way. Settle and empty the company first.
Timing matters too: lodge Form 6010 at least two weeks before the next annual review fee falls due; otherwise you can end up paying another year’s fee on a company you are closing.
Dormant vs deregistration: Cost and consequences
This is the section that matters most for the decision. Both options involve trade-offs that are easy to underestimate, so it is worth understanding exactly what each path commits you to.
What keeping a company dormant actually costs you
A dormant company is not a paused company in any legal sense. Australia has no formal dormant status that reduces your company tax obligations. The company simply keeps existing with no activity, which means every obligation under the Corporations Act continues in full.
In practice, that means:
- A$329 per year in ASIC annual review fees, due on the company’s review date every year without exception
- A nil company tax return lodged with the ATO each year, even with zero activity. If the company is GST-registered, you will likely want to cancel that registration separately, so the ATO stops expecting activity statements
- Director obligations continue. If you are a director of a dormant company, your duties under the Corporations Act remain live, including the duty to prevent insolvent trading and the obligation to keep financial records
The upside is real: the company, its ACN, its business name, any trademarks or contracts it holds, and any assets sitting inside it are all preserved and ready. You can resume trading without setting up a new entity, going through ASIC again, or rebuilding from scratch.
What deregistering a company actually ends
Deregistration removes the company from the register permanently. Once it is deregistered, it cannot trade, hold assets, enter contracts, or lodge documents, and it ceases to exist as a legal entity.
What stops immediately:
- The A$329 ASIC annual review fee
- Any ATO lodgement obligations
- Director duties and Corporations Act compliance
What you need to get right first:
- Transfer every asset out before you lodge. Anything the company still holds at the date of deregistration, including bank balances, property, trademarks, or receivables, can vest in ASIC or the Commonwealth. This is the most common and most costly mistake. People discover a forgotten asset months later and have to apply to reinstate the company to recover it, which is slow and not guaranteed
- Settle all liabilities. The company must have no outstanding liabilities to be eligible for voluntary deregistration under Form 6010
- Time the lodgement carefully. Lodge Form 6010 at least two weeks before the next annual review fee falls due, or you risk paying another full year’s fee on a company you are closing
The reversibility gap
This is the asymmetry that matters most. Dormancy is fully reversible at the cost of the annual fee. Deregistration is not. Reinstatement exists, but it is limited to specific circumstances, such as an error in the original deregistration or an incorrect declaration on a voluntary application, and it sometimes requires a court order rather than a simple ASIC application. The company cannot trade while deregistered and waiting for reinstatement to be processed.
If there is genuine uncertainty about whether you will need the company again, that uncertainty has a cost: A$329 per year. Whether that is worth paying depends entirely on what the company holds and what your realistic plans are.
When keeping the company dormant makes sense
Dormancy is the right call when the company still has a reason to exist. Keep it dormant if you expect to trade again within a year or so and do not want to re-register and rebuild from scratch. Keep it dormant if it holds something worth preserving: a valuable business name, a trademark or other intellectual property, a contract, or assets you are not ready to move out.
It also suits a pause rather than an ending, a seasonal business between seasons, a founder taking time out, or a company being held while you decide its future. The trade-off you are accepting is the A$329 annual fee plus a nil return each year, which is a modest price for keeping the option open. If that cost clearly buys you nothing, dormancy is just a slow leak.
When deregistration is the better call
Deregister when you are genuinely done. If the business has ceased for good, holds no assets or IP worth keeping, and you have no realistic plan to use the shell again, there is no reason to keep paying the review fee year after year. Deregistration draws a clean line: obligations end, fees stop, and you are not exposed to compliance failures on a company you have forgotten about.
It is also the cleaner choice for a small venture that never really took off, where maintaining a dormant company costs more attention than the company is worth. The discipline is in doing it properly: clear out assets, settle liabilities, cancel the ABN and GST, and lodge final returns before you deregister, so nothing is left stranded.
Can you bring a deregistered company back?
Sometimes, but do not count on it. Reinstatement restores a deregistered company as if it had never been deregistered, with directors and property returning to it, but it is only available in limited circumstances and to limited people. You can apply to ASIC for administrative reinstatement as a former director, secretary or member, generally where the deregistration was an error or the declaration on a voluntary application was incorrect. Otherwise you may need a court order from a superior court, which usually means legal advice and costs.
Reinstatement also takes time, and the company cannot trade while it is deregistered and waiting. This is exactly why the decision matters: dormancy is fully reversible at the price of an annual fee, while deregistration is difficult and uncertain to undo. If there is real doubt about whether you will need the company again, that doubt argues for staying dormant.
How Sleek helps
Both exits involve compliance, and both go wrong when steps are missed.
For clients, Sleek keeps a dormant company ASIC-compliant, handling the ASIC annual review and the nil tax return so it stays in good standing while you decide its future.
And when you are ready to close, Sleek helps you wind the company down: clearing any outstanding ASIC fees and tax lodgements, filing your final return, and acting as your ASIC agent to deregister the company. A dedicated accountant means whichever path you choose is done cleanly, with no forgotten assets and no surprise fees.
Sleek’s accounting and compliance plans start from A$180 a year plus ASIC fees.
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FAQs on dormant company vs deregistration
Should I keep my company dormant or deregister it?
Deregister if you are genuinely finished and the company holds no assets, IP or reason to exist, because dormancy keeps costing the annual fee for nothing. Stay dormant if you expect to trade again or want to keep the name, assets or intellectual property. The deciding question is whether you will realistically need the company again.
Does a dormant company still have to pay ASIC fees?
Yes. A dormant company still exists and keeps its Corporations Act obligations, including the ASIC annual review fee of A$329 for a proprietary company, payable every year on its review date. Australia has no status that switches these off, so a non-trading company keeps paying until it is deregistered.
Does a dormant company need to lodge a tax return?
Generally yes. If the company has no trading activity, you usually still lodge a company tax return as a nil return with the ATO each year. You may also want to cancel the company’s GST registration, so the ATO stops expecting activity statements. Lodging the nil return keeps the dormant company compliant.
Can a deregistered company be brought back?
Sometimes, through reinstatement, which restores the company as if it had never been deregistered. You can apply to ASIC as a former officeholder or member in limited circumstances, such as an error, or apply to a superior court otherwise. Reinstatement takes time; the company cannot trade meanwhile, and it is not guaranteed.
Is it cheaper to deregister or keep a company dormant?
Deregistration is cheaper long term: a one-off A$50 fee versus the A$329 ASIC review fee every year plus a nil return for a dormant company. But dormancy buys you the option to resume trading and keeps your name and assets, which can be worth far more than the fee if you genuinely expect to use the company again.
