Incorporating your company is crucial to beginning and growing your business. A company structure has many benefits and can be a suitable structure if you have long-term business growth plans. When you incorporate a company with ASIC, you will receive a registration certificate and an Australian Company Number (ACN). After this, there are a few essential steps to consider to begin trading and conducting your business. This article will explain what happens once you incorporate your company and the further steps you should take. 

Company Documents

When you incorporate your company, you will need to maintain a Company Register. This is a compulsory set of documents that all companies need under the Corporations Act 2001 (Cth). These documents should include:

  • the certificate of registration of the company;
  • share certificates;
  • a register of members or share register;
  • company officer consent forms;
  • opening meeting minutes;
  • a register of option holders (if necessary);
  • a register of debentures (if necessary);
  • copies of forms lodged with ASIC; and
  • if the company does not occupy the registered office, consent to use it.

To comply with the Corporations Act requirements, you will need to keep these documents in a safe and accessible place at the company’s registered office or place of business. They must also be available for inspection by members of the company. You must keep these documents up to date. Any changes to members or shareholders, for example, must be reflected in the company share register. You also need to notify ASIC of these changes.

At the time of incorporation, you will receive Corporate Key. This eight-digit number authorises all communications between your company and ASIC. You should keep this Corporate Key information safe with the other company documents.

First Company Meeting

The next step you should take after incorporating your company is to hold the first company meeting. There are a few essential steps to take during this meeting.

You must ensure you or the director(s) sign:

  • the consent form to act as director;
  • the application for shares; and 
  • record of the first meeting minutes. 

You should record the minutes of the first meeting in the minute book. Keeping a record of meeting minutes allows for ease of location if someone requests inspection later. You must record all subsequent members meetings in the minutes book.

You must collect the amount agreed upon to be paid per share. This can be a nominal amount. Additionally, you must issue receipts and note financial records of the transaction. After this, you must sign the share certificates.

You should keep all signed documents in the company register after this meeting.

Additional Registrations – ABN, TFN, PAYG. And GST

Following the incorporation of your company with ASIC, there are four additional registrations you need to consider:

  • Australian Business Number (ABN): Along with being issued with an ACN at the time of incorporation, you should simultaneously register for an ABN. You will need to register this if you intend to carry on business through your company. The Australian Taxation Office (ATO) requires an ANB to identify your business for taxation purposes.
  • Tax File Number (TFN): Your company will need to register for a TFN for tax purposes. You can register for a TFN when registering for an ABN.
  • Goods and Services Tax (GST): If you will be or likely to be turning over $75,000 annually, you must register for GST. You can calculate turnover on your company’s gross income, not its net profits.
  • Pay As You Go (PAYG): If your company is employing, you must register for PAYG. You are legally obligated to keep a portion of your employees’ payments for payment to the ATO on their behalf.

Shareholders Agreement

If there is more than one shareholder in the company, it is essential to draft a shareholders agreement. A shareholders agreement governs the relationship between shareholders and the company directors.

A shareholders agreement should include provisions which cover:

  • Issuing and Sale of Shares: A shareholders agreement should outline the process for issuing new shares and the sale of shareholders’ existing shares. This clause should include the method for valuing the shares and the option for existing shareholders to purchase shares first.
  • Directors Duties: The Corporations Act sets a range of directors duties. However, your shareholders agreement can also set out any additional duties required by your directors. These can include representing the shareholders’ interests, not causing detriment to the company, and discharging duties with care and diligence.
  • Shareholders and Board Meetings: The shareholders agreement should outline the issues and matters that can be decided by shareholders and by directors.
  • Dispute Resolution: A shareholders agreement should set out how disputes between shareholders, and shareholders and directors should be handled and resolved.

Ongoing Maintenance of Records and Compliance

ASIC and the Corporations Act require you to maintain and update company records at a reasonable time. You should keep minutes of all company meetings up to date and signed by all in attendance. Further, if any changes to shareholders or directors occur, you must update company records in a reasonable time and inform ASIC about this change to company details.

ASIC will send your company an annual statement at your annual renewal date. This date is when you incorporated your company. An annual renewal statement will include the fee for renewal of the company and your company’s current details. You will need to pay the renewal fee to ensure the company continues in operation for the following year.

Key Takeaways

As outlined above, after you incorporate your company, you should take further steps to get your business ready for trade. You should:

  • ensure your Company Register is up to date and in a safe place at your registered office;
  • hold your first company meeting;
  • register for ABN, TFN, GST, and PAYG if necessary;
  • draft a shareholders agreement; and
  • ensure registers are maintained and plan for annual renewal fees.

If you need assistance to incorporate a company, contact LegalVision’s business lawyers on 1300 544 755 or fill out the form on the page.

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