Setting up a company in Australia means choosing the right structure, registering with ASIC, securing your ABN/TFN, registering for GST/PAYG where required, putting core legal documents in place, and establishing reliable bookkeeping from day one. At RG Partners & Associates, Director Rohit Shukla leads a team that guides founders through these steps with clear, practical advice built on deep experience across accounting, tax, and compliance.
Quick Summary
- Pick a structure that fits your goals and risk profile (sole trader, partnership, company, or trust).
- Complete ASIC company registration correctly and plan for ongoing lodgements and annual reviews.
- Obtain ABN/TFN and register for GST and PAYG if applicable.
- Set up bookkeeping, payroll, banking, and controls early to avoid costly errors later.
- Put the right legal foundations in place (constitution, shareholder agreement, key contracts) and align tax treatment with the legal setup.
- Work with your accountant and a trusted legal partner (e.g., Law Tram) so financial, tax, and legal protections work together from day one.
Choosing the Right Business Structure Sole Trader vs Company vs Partnership vs Trust
Sole trader
- Simple to start, full personal control.
- Income is taxed at individual rates; you’re personally liable for business debts and claims.
- Best for testing an idea or very small operations, but consider asset protection limits.
Company (Pty Ltd)
- Separate legal entity with limited liability for shareholders.
- Company tax rate applies; directors owe duties and must meet ASIC obligations (annual review, changes to details, solvency resolutions).
- Suitable for growth, hiring, raising capital, or when you want clearer separation between business and personal risk.
Partnership
- Two or more people/entities carry on business together; profits distributed to partners, who are generally jointly and severally liable.
- Useful where co-owners want simplicity, but partner liability and exit mechanics need careful planning.
Trust (typically a discretionary trust with a corporate trustee)
- Trustee holds assets for beneficiaries; can offer distribution flexibility and potential asset protection if structured and administered correctly.
- More setup/admin complexity; must respect trust deed terms and keep records properly.
Tax and Liability Considerations
- Liability: Companies limit shareholder liability; partnerships and sole traders expose owners personally unless risk is otherwise managed (insurance, contracts, or trust/corporate structures).
- Tax profile:
- Sole traders/partnerships are taxed at individual rates on net profit shares.
- Companies pay company tax; franking credits may be distributed with dividends.
- Trusts generally distribute net income to beneficiaries who then pay tax at their own rates.
- Funding & exit: Companies are often better for bringing in investors, option plans, or eventual sale. Trusts may be effective for holding IP or trading assets when paired with a corporate trustee.
- Payroll & benefits: Hiring staff triggers PAYG, super, STP, and possibly FBT—your structure and employment mix affect compliance overhead.
Why Professional Advice Matters
Selecting a structure is not just a tax decision; it shapes risk, governance, investor readiness, and how profits are extracted. RG Partners & Associates helps you model cash flow, tax outcomes, and director obligations, then coordinates legal steps—constitution, shareholder or partnership agreements, and trustee documentation—through trusted legal partners such as Law Tram. This alignment reduces future restructuring costs, protects owners, and ensures ASIC and ATO settings are correct from the start.
ASIC Registration and Ongoing Compliance
Company Registration Requirements
Once you have chosen your structure, the next step is to register the company with the Australian Securities and Investments Commission (ASIC). This involves:
- Deciding on and reserving a company name (if not using an ACN).
- Nominating company officers (directors and secretaries) who must consent to act.
- Providing a registered office address and principal place of business.
- Lodging the company constitution (if adopting one) or relying on replaceable rules under the Corporations Act.
- Paying the registration fee and receiving the Australian Company Number (ACN).
After registration, ASIC issues a certificate of incorporation. This document confirms that the company is a distinct legal entity. From this point forward, directors must ensure the company complies with its obligations, including solvency, reporting, and record-keeping requirements.
Common Mistakes to Avoid
- Incorrect details at registration: Errors in names, dates of birth, or addresses can cause compliance headaches later.
- Overlooking annual review obligations: ASIC requires a yearly review fee and confirmation of company details. Missing these deadlines can result in late fees or deregistration.
- Failure to maintain registers: Directors must keep records of members, option holders, and officeholders. Poor record-keeping can create legal issues if disputes arise.
- Not understanding director duties: Directors are personally responsible for ensuring the company does not trade while insolvent and must act in good faith for the benefit of the company.
Accountant and Lawyer Collaboration
An accountant ensures ASIC filings align with tax and accounting records, while a lawyer helps establish governance documents such as shareholder agreements and constitutions. At RG Partners & Associates, we make sure ASIC registrations are lodged correctly and ongoing compliance is managed efficiently. For legal protections, including director indemnities or dispute resolution clauses, collaboration with lawyers such as Law Tram ensures clients cover both financial and legal bases.
Tax Registrations and Planning
ABN, GST, and PAYG Withholding
Every company must obtain an Australian Business Number (ABN) and Tax File Number (TFN). Depending on the business, you may also need to:
- Register for GST if annual turnover is expected to exceed $75,000 (or $150,000 for non-profits).
- Register for PAYG Withholding if you employ staff or pay directors’ fees.
- Apply for business name registration if trading under a name other than the legal entity.
BAS and Tax Lodgements
Companies must lodge Business Activity Statements (BAS) to report GST, PAYG instalments, and other obligations. For many small businesses, this is quarterly, though some may lodge monthly. In addition, companies must lodge an annual company tax return.
Early setup of reporting systems reduces compliance risks. Aligning bookkeeping with BAS lodgement cycles ensures accurate tax reporting and avoids penalties for late or incorrect submissions.
The Value of Forward Planning
Proactive tax planning is critical for new businesses. This includes:
- Forecasting cash flow to prepare for GST and PAYG liabilities.
- Considering superannuation obligations when hiring.
- Structuring director remuneration (salary, dividends, or loans) in line with both ATO and ASIC requirements.
- Planning for future growth, including when to register for FBT or when capital gains may arise.
By managing these areas early, business owners reduce the risk of unexpected tax bills, improve financial predictability, and avoid compliance-driven stress. RG Partners & Associates ensures new companies establish these registrations correctly and that long-term planning is integrated into the business model from day one.
Bookkeeping and Record-Keeping Foundations
Why Record-Keeping Matters
Accurate records are the backbone of any business. They ensure:
- ATO compliance: Proper invoices, receipts, and ledgers support BAS and tax return lodgements.
- ASIC compliance: Statutory registers and financial records prove directors are meeting their duties.
- Business insight: Reliable records help owners understand profitability, manage cash flow, and make informed decisions.
- Legal protection: In the event of a dispute, strong financial records can protect against claims of mismanagement or negligence.
Poor record-keeping is one of the most common causes of compliance failures and unnecessary stress for small business owners.
Setting Up Effective Systems
New companies benefit from implementing systems early rather than trying to fix poor processes later. Recommended steps include:
- Cloud accounting software (e.g., Xero, MYOB, QuickBooks) to automate reporting, invoicing, and bank reconciliations.
- Dedicated business bank account to separate personal and business finances.
- Payroll systems aligned with Single Touch Payroll (STP) reporting to the ATO.
- Receipt management tools to digitise records and reduce paper storage.
- Regular reconciliations to catch errors before they escalate.
Establishing these systems at the outset not only simplifies compliance but also builds a strong financial foundation for growth.
Support From RG Partners
At RG Partners & Associates, we help clients establish bookkeeping processes tailored to their business size and industry. This includes selecting software, training staff, and setting up controls to ensure accuracy. Director Rohit Shukla brings a strategic perspective, helping business owners not just record transactions but use financial data to plan, manage risk, and stay compliant. Partnering with legal advisors such as Law Tram ensures these financial systems also align with contractual and regulatory obligations.
Legal Considerations to Cover Early
Protecting Business Names and Trademarks
Registering a business name with ASIC is a start, but it does not provide ownership rights. To secure exclusive rights, businesses should consider trademark registration through IP Australia. This step prevents competitors from using similar names or branding.
Director Responsibilities and Shareholder Agreements
- Director responsibilities include acting in good faith, preventing insolvent trading, and ensuring accurate reporting.
- Shareholder agreements define decision-making processes, profit distribution, and dispute resolution. They are critical in preventing conflicts between founders and investors.
Accountants help ensure the financial terms in these agreements are workable, while lawyers draft enforceable documents to protect all parties.
Contracts and Employment Agreements
Every new company should formalise its key relationships through contracts:
- Supplier and customer contracts protect against payment disputes and delivery issues.
- Employment agreements clarify rights, duties, and entitlements, supporting compliance with Fair Work laws.
- Service agreements for contractors and consultants set clear terms to reduce the risk of misclassification.
RG Partners & Associates ensures the financial and tax implications of these agreements are correctly managed, while Law Tram and other legal partners provide the legal drafting and enforcement support.
Paying Careful Attention to Accounting and Legal Responsibilities
Starting a company in Australia requires careful attention to both accounting and legal responsibilities. From choosing the right structure and registering with ASIC to tax registrations, bookkeeping systems, and essential legal agreements, these steps create the framework for long-term business stability.
With more than 15 years of accounting and compliance expertise, Rohit Shukla and the team at RG Partners & Associates provide the financial guidance new business owners need to get these foundations right. By working alongside trusted legal partners such as Law Tram, we ensure our clients have complete coverage across both financial and legal obligations.
If you are ready to set up your company with confidence, contact RG Partners & Associates today. We’ll help you register correctly, establish robust systems, and plan for compliance from day one, so you can focus on growing your business with peace of mind.
