An incorporated company is a distinct legal entity, regulated by the Australian Securities & Investment Commission (ASIC). A company is a complex business structure, with higher set-up costs and administrative costs because of additional reporting requirements.
A company's operations are controlled by its directors and the company is owned by its shareholders. A company provides some asset protection but directors can be legally liable for their actions and, in some cases, the debts of a company.
Knowing the main features of a company business structure may help you decide if this structure is best for your business.
Tax file number (TFN)
A company needs to apply for a TFN and use it when lodging its annual tax return. You can apply for a TFN for the company on the ABN application form.
Australian business number (ABN)
A company registered under the Corporations Act 2001 is entitled to an ABN. A company that is not registered under the Corporations Act may register for an ABN if it is carrying on an enterprise in Australia.
Goods and services tax (GST)
A company can register for GST if it is carrying on an enterprise. It can do this on the ABN application form. A company must be registered for GST if its annual GST turnover is $75,000 or more. The registration threshold for non-profit organisations is $150,000.