Australia boasts of having one of the most stable economic conditions in the world. In 2019, its GDP ballooned to A$1.89 trillion. The country is also known to have the highest median wealth. The majority of this success can be attributed to its favourable political climate and free trade agreements with different countries. As such, many individuals are encouraged to start their own business. 96% of the companies in the country are small business enterprises, and the government has made it easy for its constituents to register a company in Australia.
Why register your company?
Registering a business is not compulsory for everyone, especially if it is only starting. However, doing so will set your company up for future success. More investors will come knocking at your door if they know that your business is legitimate.
Additionally, it will also allow you to cut losses since it lessons your liabilities. If you’re not registered, then other businesses that you’re dealing with are allowed to withhold 49% of the amount paid to your company. As such, it will be a huge setback for you in the long run if you delay your registration. Should you decide to register your business, you will only need to pay a corporate tax of 27.5 % to the Australian government. Incorporating will also allow you to separate your personal asset from your company asset, providing you with smoother taxation processes.
How to be registered
Based on the Corporations Act 2001, every interested company must secure an Australian Company Number (ACN) issued by the Australian Securities and Investments Commission (ASIC). It is a nine-digit number that should be disclosed on their public documents and seal. This algorithm differentiates one company from another having a similar name. It will be the same even if the company decides to rebrand.
To register a company in Australia, you must fill out Form 201 and send it to ASIC. Some of the documents you need to be compliant with the Corporations Act 2001 include consent forms from the director of your company, share member registry, and share certificates, among many others.
The cost for processing is typically around A$400. You can directly register online, but it is the slowest method. To expedite the processing of your documents, you can get the service of accredited agents who can provide you with an ASIC certification in a matter of hours.
Responsibilities after being registered
Once your company is registered, there are still some responsibilities that you have to work on to keep a good record. Aside from the ACN, you still need to comply with getting an Australian Business Number (ABN) if you did not apply this along with your ABN. Processing your ABN will also require you to work on other tax-related requirements like the Tax File Number. Pay-As-You-Go Tax and Goods and Services Tax may also be required as well.
Additionally, you may also want to arrange for corporate insurances to protect your company. The usual options provided in Australia are public liability insurance and professional indemnity insurance. The former will protect your company from property damage or personal injuries that might happen to your employees or clients. Meanwhile, the latter will shield you against unfounded allegations against business malpractice.
Having a company is a rewarding venture, but it is a great responsibility. To ensure that you will have no legal setbacks, prioritize registering your local business before expanding your reach.
Author Bio: Abdullah Hussain is a freelance writer who offers to ghostwrite, copywriting, and blogging services. She works closely with B2C and B2B businesses providing digital marketing content that gains social media attention and increases their search engine visibility.