Deregistering a Company in Australia: Step-By-Step Guide

If you’re a director or small business owner, there may come a time when winding down your company is the right call - for your business and for your peace of mind. Whether you’re closing after a great run, simplifying your structure, or responding to personal changes, deregistering a company in Australia is a formal process with clear rules.

It’s not as simple as “walking away.” There are eligibility criteria to meet, steps to follow, and important decisions to make about assets, contracts and records. If you think there’s any chance you’ll need the company again, you’ll also want to understand reinstatement.

In this guide, we’ll explain what deregistration means, when it’s appropriate, the step-by-step process with ASIC, what happens to company assets and names, and the common pitfalls to avoid. We’ll also touch on timing, costs and what you can do if you need to restore a deregistered company later.

What Does Company Deregistration Mean?

Deregistering a company removes it from the official register maintained by the Australian Securities and Investments Commission (ASIC). Once deregistered, the company stops existing as a legal entity. It can’t trade, own assets, enter contracts, sue or be sued, or carry on business in Australia.

This is different from going dormant. Deregistration is the “finish line” for the entity - you’re formally closing it out under the Corporations Act 2001 (Cth).

It’s also different from insolvency processes (like liquidation). Voluntary deregistration is only available to simple, solvent companies that meet strict criteria (more on this below). If there are debts or disputes, another path is needed.

When Should You Deregister Your Company?

Common reasons directors choose deregistration include:

• Business has ceased: You’ve stopped trading and no longer need the entity.
• Simplifying structure: You set up special-purpose companies for a project, or you’ve restructured and don’t need duplicates.
• Reducing costs: Even an inactive company carries ongoing ASIC, accounting and compliance costs.
• Personal or strategic reasons: Your plans changed and the company no longer fits.

Deregistration is only appropriate when the company is solvent and “clean.” To be eligible for voluntary deregistration with ASIC, the company must:

• Not be carrying on business.
• Have assets worth less than $1,000 in total.
• Have no outstanding liabilities (including amounts owing to the ATO, employees or suppliers).
• Have no legal proceedings on foot.
• Have paid all outstanding fees and penalties under the Corporations Act.
• Have all members (shareholders) agree in writing to deregistration.

If any of these points aren’t satisfied, you’ll need to resolve them first. For example, pay out debts, end or assign contracts, complete or settle disputes, reduce or transfer assets, and bring ASIC fees up to date.

Where there are material debts or potential insolvency issues, a formal insolvency process (such as liquidation) is usually required rather than deregistration.

Step-By-Step Deregistration Process

Here’s a practical path you can follow once you’ve decided deregistration is the right move.

1) Confirm Eligibility And Clean Up Your Position

Start with a quick checklist against the criteria above: no business activity, assets under $1,000, no liabilities, no proceedings, ASIC fees paid, member consent. If you’re not there yet, take the steps to get there.

It’s common to wrap up minor contracts or licences before you apply. If you need to bring a contract to an early end, consider using a Deed of Termination to formally close it out and manage risk. If rights need to be transferred to a new entity or person, an assignment of contracts may be more appropriate in some cases.

If there are potential claims or a dispute to settle, a short-form settlement or a Deed of Release can help you close things out before you apply.

2) Finalise Assets, Accounts And Registrations

Make sure there’s nothing left in the company when deregistration happens:

• Close bank accounts: Transfer any remaining funds. Bank accounts can be frozen on deregistration.
• Deal with property and equipment: Sell, transfer or distribute remaining assets so the total value is under $1,000. If any assets are held on trust, get specific advice before you move them.
• Intellectual property: Transfer or cancel any domain names, software licences and IP registrations. If you plan to keep using the brand elsewhere, consider protecting it with a trade mark held by the right entity.
• Business names: Business names are separate to companies. If the company owns a business name, decide whether to cancel or transfer it; see the differences between a business name vs company name.
• ABN and tax registrations: When you cease trading, cancel the ABN and any GST/PAYG registrations as appropriate, and lodge final returns (speak with your accountant).

Tax note: deregistration doesn’t erase earlier obligations. Make sure your tax position is up to date (BAS, income tax, payroll, superannuation) and keep records. If in doubt, get tax advice before you lodge the ASIC form.

3) Obtain Member Consent And Prepare Your Records

You’ll need written consent from all shareholders agreeing to deregister. Many companies record this via a circulating resolution. If you’re signing electronically, ensure you follow the legal requirements for signing documents and, where relevant, be mindful of the differences between wet ink and electronic signatures.

Keep your final accounts, bank closure confirmations and any transfer documents on file. Good record-keeping can be very helpful if questions come up later.

4) Lodge ASIC Form 6010 And Pay The Fee

When you’re ready, apply for voluntary deregistration via ASIC Form 6010 (you can lodge online or by post). There’s a small processing fee (as at 2024, $47). Fees are reviewed periodically, so check the current fee before you lodge.

After lodgement, ASIC publishes a notice of your intended deregistration. If there are no objections, ASIC will deregister the company after the notice period (typically two months).

5) Timing And What To Expect

From application to deregistration, allow around three months in total in most straightforward cases. Use that time to tidy any final loose ends and store your records securely.

What Happens To Assets, Contracts And Names?

This is where attention to detail really matters. Once the company is deregistered:

• The company stops existing: Directors and members cease to hold office in relation to that entity.
• Property issues are sensitive: Generally, property owned by the company at deregistration vests in ASIC by law. If the company held property on trust, different rules can apply (including vesting in the Commonwealth). Recovering property after deregistration can be complex and costly.
• Bank accounts and balances: Banking facilities can be frozen and balances may be dealt with under those vesting rules. Clean these up before you lodge.
• Contracts and licences: You can’t take action in the company’s name after deregistration. This is why it’s important to terminate or assign key contracts in advance using tools like a Deed of Termination or a Deed of Assignment.
• Domain names and online assets: Domain names and platform accounts are typically contractual rights with registrars and providers. If they remain in the company’s name, you risk losing control or access on deregistration. Transfer or re-paper them before you apply.
• Business names and trade marks: Deregistering a company doesn’t automatically cancel business names or trade marks. Manage these separately - cancel or transfer business names, and ensure any trade marks are held by the correct person or entity.

The safest approach is simple: make sure everything is dealt with, transferred or closed before you lodge Form 6010. Leaving assets or rights behind can create avoidable headaches later.

Common Pitfalls, Reinstatement And FAQs

Getting deregistration right is about avoiding a handful of common traps. Here’s what to look out for - plus quick answers to frequent questions.

Common Pitfalls To Avoid

• Applying too early: If debt, leases, supplier agreements or disputes are still on foot, you’re not ready. Use a Deed of Termination or an assignment where appropriate to close things out cleanly.
• Forgetting “small” assets: Old laptops, refunds due, bond credits, inventory or an unused domain can tip you over the $1,000 asset threshold - or worse, be left behind when property vests.
• Mixing up names and entities: A business name is not a company. Make separate decisions about business names, and remember the differences explained in business name vs company name.
• Assuming liabilities disappear: Deregistration ends the entity, but it doesn’t cure past breaches. Certain director liabilities can still be pursued, and the company can sometimes be reinstated for claims.
• Neglecting records: Keep resolutions, final accounts, confirmations, and any asset transfer documents. If you ever need to prove what happened, your file will save time and cost - and you may need documents like your ASIC certificate of registration for historical reference.
• Overlooking tax steps: Lodging final returns and cancelling registrations is separate to deregistration. Work with your accountant so everything lines up.

Can A Deregistered Company Be Reinstated?

Sometimes, yes. If there’s a good reason to restore the entity (for example, to deal with a claim or asset), you can apply to ASIC for administrative reinstatement or apply to a court for an order. If reinstated, the company generally comes “back to life” as if it had not been deregistered, and duties and liabilities resume.

Reinstatement is technical and fact-specific, especially where valuable assets or disputes are involved. If you’re considering this path, it’s wise to seek specialised legal support early.

How Long Does Deregistration Take?

In straightforward cases, expect around three months end-to-end. This includes a two-month notice period after ASIC accepts your application.

How Much Does It Cost?

ASIC charges a modest fee for voluntary deregistration (as at 2024, $47). You may have incidental costs (bookkeeping, final returns, legal work to tidy contracts) before you lodge. Compared to liquidation, deregistration is far cheaper - but only available to solvent companies that meet the criteria.

Can I Deregister If The Company Has Debts?

No. If there are liabilities (including ATO debts or employee entitlements), you won’t meet the eligibility criteria for voluntary deregistration. Where a company can’t pay its debts, you should get advice about insolvency options such as liquidation.

What Happens If I Miss An Asset?

If property remains in the company’s name at deregistration, it can vest in ASIC (and trust property can vest in the Commonwealth). Recovering assets later can be difficult and costly. This is why dealing with assets in advance is so important.

Do I Need To Cancel Trade Marks Or Business Names?

They don’t cancel automatically. Decide whether to transfer or cancel business names, and ensure any trade marks are held by the right owner. If you plan to keep using your brand, consider a fresh trade mark registration in the appropriate entity.

Key Takeaways

• Deregistration formally ends your company’s legal existence - it’s different to going dormant and only suitable for solvent, simple situations.
• To be eligible, the company must not be trading, have assets under $1,000, no liabilities, no legal proceedings, all fees and penalties paid, and all members must consent in writing.
• Clean up first: close bank accounts, transfer or dispose of all assets and IP, end or assign contracts, and deal with business names, domains and trade marks ahead of time.
• Lodge ASIC Form 6010 and pay the fee; allow around three months including a two‑month notice period before deregistration takes effect.
• Be meticulous with assets - property left behind can vest in ASIC, and recovering it later can be complex and expensive.
• Reinstatement may be possible in some cases, but it’s technical; getting tailored legal help can save time, cost and risk.

If you’d like a consultation on deregistering a company, you can reach us at 1800 730 617 or team@sprintlaw.com.au for a free, no‑obligations chat.