Key Takeaways
- Starting a business in Australia involves key legal responsibilities including registering a business name and obtaining an ABN.
- Registrations required for compliance include ABN, TFN, GST, business name, PAYG, and potentially FBT.
- Business name registration is mandatory if trading under a name different from your personal or company name.
- Incorporated companies have additional legal obligations under the Corporations Act 2001, including maintaining accurate records and notifying ASIC of changes.
- Seeking legal advice is crucial for understanding obligations, ensuring compliance, and protecting intellectual property.
Starting a business in Australia is an exciting milestone—but it also comes with key legal responsibilities that are essential to get right. From registering a business name and obtaining an ABN to understanding your tax and reporting obligations, legal compliance lays the foundation for long-term success.
This business setup legal checklist for Australia highlights the critical steps every new business must take to meet government requirements and ensure ongoing compliance. Whether you are launching as a sole trader, partnership, or company, understanding the legal obligations for new businesses in Australia will help your business start strong and operate confidently.
Understanding Registrations vs. Licences
Before launching, you must understand the distinction between business registrations and licences:
Registrations
Required for identification and taxation purposes. These include your ABN, TFN, business name, GST, and PAYG registrations.
Licences
Specific approvals that allow you to operate in regulated industries such as food, construction, health, or education.
Use the Australian Business Licence and Information Service (ABLIS) to search for the licences, permits, and compliance requirements relevant to your business type, industry, and location. ABLIS allows you to create a tailored report that outlines the government approvals your business may need at the federal, state, and local levels.
Registrations Every New Business Must Complete
To ensure compliance for small businesses in Australia, you must complete several key registrations with the ATO and ASIC. These include the following:
1. Australian Business Number (ABN)
An ABN is a unique 11-digit identifier that allows your business to interact with government agencies, issue invoices, and register for GST. Apply via the Australian Business Register.
2. Tax File Number (TFN)
If your business is structured as a company, trust, or partnership, you must apply for a separate business TFN. Sole traders may use their personal TFN.
3. Goods and Services Tax (GST)
GST registration is compulsory if your business has a projected or current annual turnover of $75,000 or more. Registration is completed through the ATO.
4. Business Name Registration
You must register your business name if you are trading under a name other than your personal name or your company’s legal name. Business name registration is managed through ASIC Connect.
5. Pay As You Go (PAYG) Withholding
If you hire employees or make certain payments to contractors, you will need to register for PAYG withholding to manage employee tax obligations. Register via the ATO.
6. Fringe Benefits Tax (FBT)
If your business provides non-cash benefits to employees—such as company cars, entertainment, or low-interest loans—you may need to register for Fringe Benefits Tax (FBT). This tax is separate from income tax and applies to the value of these benefits. Businesses must lodge FBT returns and comply with ATO reporting obligations. For more information and to register, visit the ATO website.
Together, these registrations form the core of the ABN, GST, TFN registration process and cover important PAYG and FBT registration requirements, which are critical to setting up your business for long-term compliance and success.
Registering a Business Name with ASIC
When Business Name Registration Is Required
You are legally required to register a business name if you are:
- Trading under a name that is not your personal name
- Operating under a name that differs from your registered company name
- In a partnership and using a trading name that does not include all partners’ legal names
How to Register
Business name registration is done via ASIC Connect, and you must have an ABN before applying. This is a key component of the company registration process in Australia.
Legal Responsibilities
- Notify ASIC within 28 days of any change to your business details
- Renew your business name registration annually or every three years
- Inform ASIC if the business name holder becomes disqualified
- Display your registered business name and ABN on all official documents, including invoices, contracts, and websites.
Important: Registering a business name does not grant exclusive rights. For trademark and brand protection in Australia, consider registering a trademark through IP Australia.
Legal Obligations for Incorporated Companies
If you are registering a company, your legal obligations increase under the Corporations Act 2001. These include:
Establish Company Details
- Set up a registered office (where ASIC can send correspondence)
- Identify your principal place of business
- Appoint at least one director and report their personal details to ASIC
Ongoing Compliance Requirements
- Keep accurate and up-to-date financial and accounting records
- Notify ASIC of changes to company details, directors, or addresses
- Receive and respond to your annual company statement
- Pay ASIC review fees on time to avoid deregistration
Directors of Australian companies must meet certain legal standards in the management of the business. These include exercising reasonable care and skill, making decisions in good faith, avoiding situations where their personal interests may conflict with the company’s interests, and ensuring the company does not continue to operate while insolvent. These responsibilities reflect the broader scope of ASIC business obligations.
Further guidance is available via ASIC’s company obligations checklist.
How Legal Advice Supports Business Success
Understanding your legal obligations is essential, but legal processes can be complex and time-consuming—especially when you are focused on launching your business. Working with experienced professionals offering commercial legal services for startups can help you:
- Choose the most suitable business structure
- Complete all registrations correctly
- Ensure ongoing compliance with ASIC and the ATO
- Protect your intellectual property
- Draft key legal documents, including partnership agreements and employment contracts
Protect Your Business from the Ground Up
Legal compliance is a vital part of launching any business. From selecting the right structure to meeting registration obligations and protecting your intellectual property, taking a proactive legal approach reduces risk and strengthens your foundation for growth.
Understanding the legal landscape is not always straightforward. Missteps can lead to regulatory penalties, reputational harm, or operational setbacks. Working with knowledgeable commercial lawyers ensures your business complies with Australian laws and operates with clarity and confidence from day one.
At Pentana Stanton Lawyers, we provide strategic legal guidance for new and growing businesses. Our team helps you navigate regulatory requirements, draft essential documents, and implement sound legal structures tailored to your goals.
Set your business on the right path. Contact us today to schedule a consultation and take the first step toward a secure and successful future.
