Australia offers overseas business owners a stable economy, a transparent legal system and access to markets across Asia and the Pacific. Before you start, it pays to understand how doing business here works. These are the five things we see overseas clients most often need to get right.
1. Choose the right structure
Most overseas businesses enter Australia in one of two ways:
- An Australian subsidiary company. A new proprietary company, usually owned by your overseas company. It is a separate legal entity under Australian law.
- A branch of your overseas company. Your existing company registers with ASIC as a foreign company and receives an Australian Registered Body Number (ARBN). A branch is not a separate legal entity.
If you need a company quickly, a shelf company that is already registered can save time. Our article on the differences between subsidiaries and registered foreign companies compares the two structures in more detail. Get independent tax and legal advice before you decide.
2. Appoint a resident director
Foreign citizens and overseas companies can own an Australian company outright. What the law does require is that a proprietary company has at least one director who ordinarily lives in Australia, and a public company at least two. A branch needs a local agent instead.
If none of your directors live here, an Australian resident director solves this. Remember that every director, including a resident director appointed as a nominee, has real legal duties.
3. Have a registered office and stay compliant with ASIC
Every Australian company needs a registered office in Australia where ASIC sends official mail, and it can't be a PO Box. Each year the company receives an annual statement from ASIC, must check its details and pay the annual review fee, and must tell ASIC about changes such as new directors or a new address.
An ASIC registered agent can receive your ASIC mail, alert you to what is due and lodge changes for you, and can also provide your registered office address.
4. Register for tax
Most businesses need an Australian Business Number (ABN), and you need one to register for GST. Your company will also need a Tax File Number (TFN), and a company carrying on business in Australia must appoint a public officer for tax purposes. Our article on the difference between an ABN and an ACN explains these numbers. Some investments by foreign persons, such as certain land or business acquisitions, may also need approval from the Foreign Investment Review Board (FIRB), so check with your adviser.
5. Director ID, banking and currency
Every director needs a director ID before they are appointed, including directors who live overseas. Plan ahead for banking too: Australian banks verify the identity of a company's directors and owners before opening an account, which can take time from overseas.
If you will move money between Australia and other countries, compare foreign exchange providers rather than relying on standard bank rates. Exchange rates move in both directions, and small differences add up on large or regular transfers.
Getting started
Doing business in Australia from overseas is very achievable with the right local support. Director Corporate Services helps overseas businesses with branch and subsidiary set-up, resident directors, registered agent services and shelf companies. Contact us or call +61 7 5600 9777 to talk about your plans.
