Having established what you need to do first as a director of a newly-registered company, let’s look at what comes next after completing these initial steps.
After setting up a new company, we recommend that you register your ABN, complete your tax registrations and open a company business account.
To get started, let’s briefly review the first steps you should have already taken as a new company director. As mentioned previously, if you have just become a new company director, you will need to:
- Understand your obligations and duties as a director.
- Start and maintain a company register, collect your relevant company documents and records.
- Start keeping track of your company decision making by written minutes.
- Start and maintain a share register.
- Keep all your consents up to date.
With these immediate actions squared away, you can now start completing the following steps.
1. Register Your ABN
After you have received your Certificate of Registration, you can now register an Australian Business Number (ABN) for the company.
An ABN is generally required for all businesses operating in Australia – not to be confused with an Australian Company Number (ACN), which all companies automatically have on incorporation. Be sure to apply for your company’s ABN first because you will be using this to complete the other registrations also.
You can apply for an ABN at the same time you are registering your company with ASIC. If you didn’t, don’t sweat! It’s easy to apply for an ABN online – and it’s free.
Don’t forget to store a copy of your ABN and any other registrations along the way in your new company register.
2. Register Your TFN
With your ABN in hand, you can now register a Tax File Number (TFN) for the company. This is because your company is now a separate legal entity, so it will need its own TFN for the end of financial year tax return and during the year BAS filings.
You can usually apply for a TFN when you apply for an ABN. Or, if you’re not sure, get help from your accountant and tax agent.
3. Register For PAYG
If you have employees (including yourselves as directors), you will need to register for Pay As You Go (PAYG) withholding and will need to withhold the correct amount of tax from your payments. This will also apply where you make payments to a business which has not registered for an ABN and should. PAYG withholding helps workers meet their tax obligations, and you must register before you are required to withhold tax for another person or business.
To clarify, PAYG withholding registration is different to PAYG instalments, which are periodic part payments towards your end of financial year tax bill.
Most companies will register for PAYG through their accountant, however you are able to register yourself on the ATO business portal here.
4. Register For GST
If you believe your company will generate over $75,000 in the financial year, you will need to register for and collect GST on your invoices. If you are not likely to exceed the amount for the current financial year, in the future be sure to register within 21 days of revenue exceeding the financial threshold.
For the $75,000 threshold, this will apply differently depending on whether you operate on a cash accounting or accrual basis. The primary difference is that on a cash basis, the income requirement will apply and be owed according to the amount of money that your business has actually received. On the other hand, businesses operating on the accrual basis will owe GST based on how much sale income has been generated, regardless of whether the business has actually received that income in the period.
If you are unsure which accounting method is best for your business, or which one you are currently using, contact your accountant. Your accountant can also help you register for GST, or you can do it yourself on the ATO business portal.
5. Open A Company Bank Account
Now that you have successfully registered your company with the tax office, you will be able to open a company bank account which you will need to use for making your company transactions moving forward.
How To Open A Company Bank Account:
In order to open your company’s bank account, prepare the following:
- Authority to open a bank account. Most company setup packages will have a handy template document for this type of resolution, which requires you to declare that the company has decided to open a bank account and that all the company directors agree, with their signatures.
- 100 points of identification. 100 points of ID can be made up by a range of documents, including your passport, driver’s license, medicare card, etc. If you are unsure how many pieces you will need, contact your bank manager.
- Details of all your company’s directors, secretary and members, together with their relative appointments dates.
- Your company’s Certificate of Registration.
- Your Company Constitution, if you have one.
Once you have these documents prepared, bring them to your bank manager who will be able to open your bank account for you.
If you have taken the steps above, congratulations! You have now completed your post company registration setup actions and are ready to focus on growing your business.
However, don’t sleep on your other legal obligations. Be sure to keep accurate records throughout the year, be mindful of your directors’ duties and keep your company details up to date with ASIC and through your annual statement.
If you would like help or more information about any of the above steps, be sure to contact us at Sprintlaw for qualified, fixed-fee legal help. Contact the team at 1800 730 617 or email@example.com.