Should You Set Up a Company in Australia?
Before registering a company, the most important question is whether a company structure is actually right for your situation.
| Structure | Best For | Tax Rate |
|---|---|---|
| Sole Trader | Freelancers, low revenue, starting out | Personal marginal rate (up to 47%) |
| Partnership | Two or more people in business together | Each partner’s marginal rate |
| Company (Pty Ltd) | Growth businesses, liability protection, retaining profits | 25% or 30% flat |
| Trust | Family businesses, income splitting, asset protection | Distributed at beneficiary rate |
A company makes sense when your taxable income exceeds approximately $120,000 to $135,000, you want limited liability protection, you plan to bring in investors or sell the business, or you want to retain profits at the lower company tax rate. For a detailed comparison, read our guide on Sole Trader vs Company vs Trust. Our Business Advisory team can run through the numbers for your specific situation.
What You Need Before Registering a Company
Directors and Shareholders
Every Australian company must have at least one director who is ordinarily a resident of Australia. Directors must be at least 18 years old. A company must have at least one shareholder. The director and the shareholder can be the same person.
Company Name
Your company name must be unique and not too similar to an existing registered name. Check availability through ASIC Connect. The name will end in “Pty Ltd” (Proprietary Limited). If you plan to trade under a different name, you will also need to register a Business Name with ASIC separately ($44/year).
Share Structure
Deciding how shares are allocated at setup is one of the most important decisions you make. Getting it wrong is costly to fix later. Consider: how many shares will be issued and at what price, whether there will be different classes of shares, who will hold shares and in what proportions, and how disputes will be resolved if there are multiple shareholders.
How to Register a Company in Australia: Step by Step
Step 1: Choose your company name and check availability
Search ASIC Connect to confirm your preferred name is available.
Step 2: Decide on your company structure
Choose the type of proprietary company and decide your share structure before you register.
Step 3: Appoint your directors
Identify who will be directors. A proprietary company does not need to have a company secretary but can appoint one.
Step 4: Register through ASIC
Register through ASIC Connect at asic.gov.au or through a registered agent. ASIC will issue an Australian Company Number (ACN) upon registration.
Step 5: Obtain an ABN and TFN for the company
The company needs its own Australian Business Number (ABN) and Tax File Number (TFN), separate from any you hold personally. Apply through the Australian Business Register (abr.gov.au) and the ATO.
Step 6: Register for GST if required
If your company’s annual GST turnover is $75,000 or more, you must register for GST. For details on GST and BAS obligations, read our guide on What Is a BAS and How Do You Lodge It in Australia?
Step 7: Open a company bank account
The company must have its own bank account, separate from any personal accounts. Company funds must never be mixed with personal funds.
Step 8: Set up bookkeeping and accounting systems
From day one, the company needs proper financial records. Our Bookkeeping, Reporting and Payroll service can set this up correctly from the start using Xero or MYOB.
How Much Does It Cost to Register a Company in Australia?
| Item | Cost (2026) |
|---|---|
| ASIC company registration (12 months) | $597 |
| ASIC company registration (3 years) | $1,408 |
| Business name registration (1 year, if needed) | $44 |
| ABN application | Free |
| TFN application | Free |
| Professional setup assistance (accountant) | $800 to $1,500 |
Company Tax Obligations After Registration
Company Tax Return
Every company must lodge an annual company tax return with the ATO. A company files its own return and pays tax at the company rate: 25% for base rate entities (aggregated turnover under $50 million), or 30% for all other companies.
PAYG Withholding and STP
If the company pays wages, it must register for PAYG withholding and report payroll information to the ATO in real time via Single Touch Payroll (STP). This applies from the first pay run.
Superannuation Guarantee
Companies paying employees must contribute the Superannuation Guarantee (11.5% of ordinary time earnings in FY2026) into the employee’s nominated super fund by the quarterly due dates.
For a full picture of how a company’s tax obligations connect with your personal tax position, our Taxation and Accounting service handles both the company and individual returns.
Frequently Asked Questions
How do I set up a company in Australia? Register through ASIC Connect at asic.gov.au. You will need a company name, at least one Australian-resident director, shareholder details, and a registered office address. ASIC issues an ACN on registration. You then separately apply for an ABN and TFN through the ATO.
How much does it cost to register a company in Australia? The ASIC registration fee is $597 for a standard 12-month registration in 2026. Add business name registration ($44/year if needed), plus professional setup costs of $800 to $1,500 if using an accountant. Total is typically $1,400 to $3,000.
What is the difference between an ACN and an ABN? The ACN (Australian Company Number) is issued by ASIC when you register the company. The ABN (Australian Business Number) is issued by the ATO and is used for tax purposes. A company needs both.
Setting up a company and want to get the structure right from day one? Our Chartered Accountants handle the full setup process. Call 02 9980 1556 or visit verusaa.com.au. 973 Pacific Hwy, Pymble NSW 2073. Monday to Friday, 9am to 5pm.
