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Company Set Up

Company is a separate legal entity which offers limited liability to shareholders. A private (proprietary) company will be address as XXX Pty Ltd and a public company will be address as XXX Ltd.

Advantages of a company include that:

  • liability for shareholders is limited
  • shareholders’ ownership can be transferred to other party
  • majority of the companies will have its tax rate  decreased to 25%
  • company can retain profit after paying income tax and can pay out retained profit later on as needed and franking credit can be passed on to the shareholders
  • company has perpetuity and can trade anywhere in Australia
  • company can employ directors and shareholders

Disadvantages of a company include that:

  • the company can be expensive to establish, maintain and wind up
  • the reporting requirements can be complex
  • if directors fail to meet their legal obligations, they may be held personally liable for the company’s debts


How to set up a company?

Step one – ASIC registration

You will need to provide:

  • Company name & state of registration
  • Registered and business address
  • Number of shares issued, class of shares, cost per share, total amount paid and unpaid,  whether the shares are being beneficiary hold or not
  • Shareholders’ name, date of birth, address, contact details, place of birth and shareholding %
  • Directors’ and secretaries: name, date of birth, address, contact details and place of birth

Step two – ATO registration

Once the company is established, you can register ABN, TFN, GST & PAYG withholding by applying to Australian Business Register.

Under section 201A of the Act:

  • A proprietary company must have at least 1 director, and that director must ordinarily reside in Australia.
  • A public company must have at least 3 directors, with 2 directors ordinarily residing in Australia.
  • A proprietary company does not have to have a sectary but a public company has to have one

Other Important issue

If a director or a shareholder happens to be a non – resident, extra information need to be provided to the ATO, such as notarized ID and passport.

In some cases, you need to seek FIRB approval to admit non – resident shareholder.


When a shareholder transfers its shares, market value rule will apply. The transferor might be subject to capital gains tax. The transfer could attract stamp duty where underlying asset is real property. 

Legal Information

The Audit Shield insurance policy is not compulsory although we highly recommend that all of our clients take up the insurance. Consolid8 receives a portion of the premium and we hold the policy on your behalf. The policy covers one financial year and we will contact you prior to arrange renewal in advance of the relevant expiry date. The Audit Shield Insurance is not automatic and you must opt in to receive the cover.



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