Based in Sydney, Raja is a law student enrolled in a Bachelor of Laws and Bachelor of Communications (Writing and Publishing) at the University of Technology Sydney. He is passionate about transferring knowledge in relation to businesses, legal advice and marketing direction. Raja has experience working in immigration law and is driven by the writing, editing and publishing process of content.
Introduction
Many Australian business owners feel uneasy about ASIC compliance, even if they believe it is mostly under control. The company was set up years ago, the accountant helps with tax, and nothing significant has changed recently. On the surface, everything seems fine.
ASIC compliance, however, is one of those areas where assumptions are costly.
Unlike tax obligations, ASIC compliance focuses on company governance, records, and transparency. It operates on strict deadlines and automatic penalties. Miss one requirement and fees can apply without warning. Miss several and directors may be personally exposed to liability.
This article breaks down the most common ASIC compliance mistakes we see across Australian companies. More importantly, it explains how to avoid them before they quietly turn into late fees, penalties, or ongoing compliance risk.
Table of Contents
1. Assuming the ASIC Annual Review Is Optional
Every registered Australian company must complete an ASIC annual review every year. This applies regardless of company size, trading status, or whether any details have changed.
A common assumption is that if nothing has changed, there is nothing to do. This is incorrect.
Each year, ASIC issues an annual review statement confirming the details it holds for your company. Directors must review this information, confirm its accuracy, pass a solvency resolution, and pay the annual review fee.
Why this matters
If the annual review is not completed on time, ASIC automatically applies late fees. These fees increase over time and can quickly outweigh the original cost of the review. ASIC does not waive fees because notices were missed or overlooked.
How to avoid it
Know your annual review date and ensure reminders are not missed. Review company details carefully each year, even if you believe nothing has changed. Many businesses benefit from having an ASIC registered agent manage this process so deadlines are never overlooked.
2. Missing the 28 Day Update Requirement
ASIC requires certain company changes to be lodged within 28 days of the change occurring. This timeframe is strict and applies to a wide range of updates.
These include changes to directors or secretaries, registered office address, principal place of business, share structure or shareholdings, and company name.
The most common mistake here is delay. Business owners often update internal records, tell their accountant, or note the change in company documents, but forget to lodge the update with ASIC.
Why this matters
ASIC late fees apply automatically once the 28 day window has passed. Repeated failures to update company details can also be viewed as a breach of director duties, particularly where records become inaccurate.
How to avoid it
Any time a company detail changes, assume ASIC must be notified. Treat updates as time sensitive compliance tasks, not administrative cleanup items to be done later.
3. Believing Compliance Is Fully Outsourced
Many directors believe that because they use an accountant, lawyer, or bookkeeper, ASIC compliance is fully handled.
While professionals can assist with lodgements, directors cannot outsource responsibility.
Under Australian law, directors are ultimately responsible for ensuring ASIC obligations are met correctly and on time. If compliance fails, ASIC can pursue directors directly, regardless of who was meant to handle the paperwork.
Why this matters
Director liability can extend beyond fines. Persistent noncompliance can result in enforcement action, company deregistration, or restrictions on future directorships.
How to avoid it
Directors should have a clear understanding of their core ASIC obligations and visibility over how compliance is being managed. Using a registered ASIC agent provides assurance that lodgements are handled correctly while still supporting directors in meeting their legal duties.
4. Ignoring Obligations for Dormant Companies
A dormant company is still a registered company in the eyes of ASIC. Even if the business is not trading, ASIC compliance obligations continue to apply.
A common assumption is that no trading activity means no compliance requirements. This leads many dormant companies to ignore annual reviews, solvency resolutions, and record keeping obligations.
Why this matters
Dormant companies that fail to meet ASIC requirements still accrue late fees. Over time, penalties can exceed the cost of maintaining compliance. ASIC may also deregister companies that appear abandoned, which can create complications if assets or intellectual property are still held.
How to avoid it
If a company is dormant but intended to remain registered, ongoing compliance must be maintained. If the company is no longer needed, directors should consider voluntary deregistration rather than allowing compliance issues to build.
5. Confusing ASIC and ATO Responsibilities
ASIC and the ATO regulate different aspects of a business, yet many business owners assume that meeting tax obligations also satisfies company compliance requirements.
This is not the case.
The ATO focuses on tax reporting and payments. ASIC focuses on company governance, accuracy of records, and transparency. These are separate regulatory systems with different deadlines and obligations.
Why this matters
A company can be fully up to date with BAS, income tax, and payroll obligations while still being noncompliant with ASIC. Missing ASIC obligations can trigger penalties even if tax compliance is perfect.
How to avoid it
Treat ASIC compliance as a separate compliance stream with its own deadlines, forms, and responsibilities. Make sure someone is clearly accountable for monitoring both.
6. Lodging Incorrect Forms or Information
ASIC compliance often involves lodging specific forms, such as Form 484 for changes to company details. These forms must be completed accurately and within the required timeframe.
A common mistake is lodging incorrect information, misunderstanding which form applies, or submitting partial updates.
Why this matters
Incorrect lodgements can be rejected or accepted with errors that create future compliance problems. Fixing mistakes later often requires additional forms, explanations, and fees.
How to avoid it
Ensure the correct form is used for each type of change and that all details are verified before submission. This is an area where using an experienced ASIC agent can significantly reduce risk.
7. Assuming Compliance Is a One Time Task
Many business owners treat ASIC compliance as something that is handled at company setup and then forgotten.
In reality, ASIC compliance is ongoing. Annual reviews recur every year. Update obligations apply whenever changes occur. Director responsibilities continue for as long as the company exists.
Why this matters
Over time, small missed obligations stack up. A missed update here, a late annual review there, and suddenly a company is facing multiple penalties and compliance stress.
How to avoid it
Adopt a structured approach to ASIC compliance. This might include a compliance checklist, calendar reminders, or engaging a registered ASIC agent to manage obligations proactively.
Why Many Businesses Choose an ASIC Registered Agent
Managing ASIC compliance internally is possible, but it requires consistent attention to deadlines, forms, and changing obligations. For many directors, this creates unnecessary risk and distraction.
As a registered ASIC agent, Lawpath is authorised to lodge documents directly with ASIC on your behalf. Our ASIC compliance plan is designed to remove uncertainty and reduce director risk.
With Lawpath, you benefit from annual review tracking and management, timely lodgement of required updates, accurate maintenance of company records, and reduced risk of late fees and penalties. Instead of reacting to ASIC notices, you stay compliant by design.
