en
en
A company (Pty Ltd) is the most common structure for growing Australian businesses. It provides asset protection, a flat 25% tax rate, and clear separation between personal and business finances. We handle the full ASIC and ATO setup from day one.
Book a 60-minute consultation — AUD $250, credited to your services if you engage. We’ll assess your situation and deliver a formal written proposal.
A 60-minute video call to assess your company structure, ASIC setup requirements, and tax position — and deliver a formal written proposal for our services.
Via video call · 60 minutes
Book Now — AUD $250
A proprietary limited company (Pty Ltd) is a separate legal entity registered with the Australian Securities and Investments Commission (ASIC). It is distinct from its shareholders and directors — it can own assets, enter contracts, employ staff, and incur liabilities in its own name. This separation is the foundation of the company’s most important feature: limited liability.
A Pty Ltd company must have at least one director who is an Australian resident, and at least one shareholder. A single person can be both the sole director and sole shareholder. There is no requirement for multiple founders or a large initial capital investment.
The company owns its assets and is responsible for its own debts. Shareholders are generally not personally liable for the company’s obligations beyond their share capital.
Companies with aggregated annual turnover under $50 million pay a flat 25% corporate tax rate — compared to marginal rates of up to 47% for individuals.
Shares can be issued to new investors, employees, or co-founders. Ownership is clearly defined and can be transferred without dissolving the business.
For most growing businesses, a company offers a substantially better combination of asset protection, tax efficiency, and flexibility than operating as a sole trader or partnership. Here is what you gain.
Shareholders’ personal assets are generally protected from the company’s debts and liabilities. If the business is sued or becomes insolvent, creditors cannot typically pursue the shareholders’ personal property. Note: directors can still be personally liable under the Director Penalty Notice regime for unpaid PAYG and SGC obligations.
Small business companies pay a flat 25% corporate tax rate on all taxable income. Compare this to a sole trader or partner paying up to 47% on income above $190,000. For a business earning $150,000 in profit, the company structure can save over $20,000 in tax annually.
Unlike a sole trader who pays tax on all profit immediately, a company can retain earnings inside the entity at the 25% rate and reinvest them into the business. This makes a company particularly powerful for businesses that reinvest rather than distribute all profits each year.
A Pty Ltd company signals professionalism and permanence to clients, suppliers, and financiers. It also provides business continuity — the company continues to exist regardless of changes in ownership, unlike a partnership or sole trader arrangement.
Registering a company involves more than lodging a form with ASIC. We manage the full setup — ensuring all registrations are completed correctly, in the right sequence, and that the structure is aligned with your tax strategy from day one.
Your company setup includes everything below, handled end-to-end:
A company pays a flat corporate tax rate on its taxable income. For small business companies (aggregated annual turnover under $50 million), the rate is 25%. For larger companies, it is 30%. This is a significant structural advantage over sole traders and partners, who pay individual marginal rates.
All taxable income earned by the company is taxed at 25% (small business rate). There are no tax-free thresholds and no marginal rate increases. A company earning $200,000 pays $50,000 in tax. A sole trader on the same income would pay approximately $66,717 + Medicare Levy — over $18,000 more.
Small business rate 2025–26Shareholders extract profits either as a salary (deductible to the company, taxed as personal income) or as a dividend (paid from after-tax profit). Dividends carry franking credits equal to the corporate tax already paid, which offset the shareholder’s personal tax liability — avoiding double taxation.
Profits not distributed to shareholders remain inside the company, taxed at 25%. This is particularly advantageous for businesses reinvesting profits into growth — the company retains 75 cents of every dollar earned, versus a high-income sole trader retaining as little as 53 cents.
Powerful for reinvestment strategiesCompanies lodge an annual company tax return and pay tax through PAYG instalments during the year. If the company employs staff or directors under a salary, PAYG Withholding also applies. We manage all lodgements and instalment calculations as part of ongoing compliance.
Small business companies with aggregated annual turnover under $50 million pay a flat 25% corporate tax rate. Companies above this threshold pay 30%. These rates apply to all taxable income — there is no tax-free threshold for companies.
ASIC charges $576 for a standard company registration (2025–26 fee). This covers the ACN, registration with ASIC, and the first year’s annual review fee. Our professional fee for the complete setup — ASIC registration, ABN, GST assessment, and advisory — is quoted upfront in your service proposal following the consultation.
Yes. A proprietary limited company can have a single director who is also the sole shareholder. This is a very common structure for sole traders upgrading to a company. The director must be an individual (not another company) and must ordinarily reside in Australia.
A Director Penalty Notice is issued by the ATO when a company has unpaid PAYG Withholding or Superannuation Guarantee Charge (SGC) obligations. Directors can be held personally liable for these amounts — even if they were not personally involved in the failure to pay. This is one of the few exceptions to limited liability and a key reason why timely BAS and SGC lodgement is critical.
When a company pays tax at 25% and then distributes a dividend to shareholders, the dividend can be “fully franked” — meaning it carries a credit for the 25% tax already paid. The shareholder includes the grossed-up dividend in their income but receives a tax offset for the franking credit, preventing double taxation. For shareholders in lower tax brackets, a franking credit refund may be available.
Division 7A of the Tax Act prevents shareholders or their associates from accessing company funds as informal loans, gifts, or payments without those amounts being treated as dividends. If you take money out of your company without following the correct procedures, the ATO may deem it a dividend — with no franking credits attached. We advise on Division 7A compliance as part of every company setup.
Both structures offer asset protection and tax benefits, but they work differently. A company is best for retained earnings, reinvestment, and businesses with a single owner or equal co-founders. A discretionary trust is more flexible for income distribution among family members and estate planning. Many sophisticated structures combine both — a trust owning the shares in a company. We cover this comparison in detail during the consultation.
60 minutes. Tailored to your situation. Formal written service proposal included.
✓ No obligation to proceed · Fee credited to implementation if you engage