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
Australia has become an attractive destination for overseas founders and foreign businesses looking to establish a presence in the Asia-Pacific region. With a stable economy, strong legal frameworks, and access to regional markets, incorporating a company in Australia makes strategic sense for many international operators.
But the process isn’t as simple as filling out a form online. Australia has specific legal requirements around directors, registered offices, and ongoing compliance that catch many overseas founders off guard. Understanding these requirements before you register can save you time, money, and legal headaches down the track.
This guide is designed for foreign individuals and entities who want to incorporate a company in Australia but need clarity on eligibility, structure, and what ASIC, the Australian Securities and Investments Commission actually requires.
Can Foreign Individuals or Overseas Businesses Incorporate in Australia?
Yes. Foreign individuals and overseas businesses can absolutely incorporate a company in Australia. There’s no requirement to be an Australian citizen or permanent resident to own or control an Australian company.
However, ownership and operational control are two different things. While you can be a foreign shareholder or director, Australian company law imposes strict requirements around who can legally act as a director and where the company must maintain its registered office. These requirements are designed to ensure ASIC and other regulators can contact and hold someone accountable if needed.
The most common structure for overseas founders is a proprietary limited company, referred to as a “Pty Ltd” company. This is the Australian equivalent of a private limited company in the UK, a GmbH in Germany, or an LLC-style structure in other jurisdictions. It provides limited liability, meaning shareholders are generally only liable up to the amount they’ve invested in the company.
Foreign companies can also register as a foreign company operating in Australia, rather than incorporating a new Australian entity. This is typically used when the overseas business wants to trade in Australia using its existing legal entity. The process and obligations differ significantly, so most founders looking to establish an Australian base prefer to incorporate locally.
Australian Resident Director Requirement
This is where many overseas founders hit their first roadblock. Under Australian law, every company must have at least one director who is an Australian resident.
An Australian resident, in this context, means someone who ordinarily resides in Australia. ASIC doesn’t require the director to be an Australian citizen or permanent resident, they could be on a temporary visa but they must live in Australia and be contactable by regulators.
This requirement exists for regulatory and enforcement reasons. ASIC needs to be able to contact directors, issue notices, and take action if the company breaches its obligations. A director based overseas, especially in a jurisdiction with no extradition or enforcement agreements, creates a compliance gap.
For overseas founders, this means you’ll need to either:
- Relocate to Australia yourself and become a resident director.
- Appoint a trusted Australian-based individual to act as a director.
- Use a professional resident director service (though this comes with its own risks and obligations).
If you can’t meet this requirement, you cannot legally incorporate a standard Australian company. Some overseas founders mistakenly register a company without an Australian resident director, only to face compliance issues, penalties, or even deregistration later.
It’s worth noting that if your company has multiple directors, only one needs to be an Australian resident. The others can be based anywhere in the world. This allows overseas founders to remain involved in governance while meeting the legal requirement.
Registered Office Requirement
Every Australian company must have a registered office in Australia. This is the official address where ASIC, the Australian Taxation Office (ATO), and other regulatory bodies send legal notices and correspondence.
The registered office must be a physical address in Australia, not a PO box. It must also be accessible to the public during normal business hours. This is typically an office, a commercial address, or a professional registered office service.
If you’re an overseas founder without a physical presence in Australia, you’ll need to arrange a registered office before you can incorporate. Many company formation services and legal providers offer registered office services as part of their incorporation package. This can be a practical solution if you’re not yet ready to lease office space in Australia.
The registered office address is publicly listed on ASIC’s company register, so it’s visible to anyone who searches for your company. For that reason, many founders prefer to use a professional service address rather than a home address, especially in the early stages.
What ASIC Requires at Incorporation
When you incorporate a company in Australia, you’re required to lodge an application with ASIC. The application must include:
- The proposed company name (which must be available and comply with naming rules).
- The type of company (usually a proprietary limited company for private businesses).
- Details of at least one director who is an Australian resident.
- Details of all other directors and shareholders.
- The registered office address in Australia.
- The principal place of business (if different from the registered office).
- The company’s proposed share structure and who holds shares.
- Consent forms from all directors and the company secretary (if applicable).
ASIC reviews the application and, if everything is in order, issues an Australian Company Number (ACN) and a Certificate of Registration. This usually happens within one business day if the application is lodged electronically.
Once your company is incorporated, it becomes a separate legal entity. It can enter contracts, own property, employ staff, and operate as a business in its own right. But incorporation is just the beginning, ongoing compliance obligations start immediately.
Understanding Australian Company Structures
Australia offers several company structures, but the most relevant for overseas founders are:
Proprietary Limited Company (Pty Ltd): This is the standard structure for private companies. Shares are held privately (not offered to the public), and the company must have at least one director and between one and 50 non-employee shareholders. It provides limited liability and is suitable for most small to medium-sized businesses.
Public Company (Ltd): A public company can raise capital from the public and list on a stock exchange. It has stricter reporting and governance requirements and is typically used by larger businesses or those planning to go public.
Foreign Company Registration: If you’re an overseas entity that wants to carry on business in Australia without creating a new Australian company, you can register as a foreign company. This means you’re using your existing legal entity but complying with Australian registration and reporting requirements.
For most overseas founders, a Pty Ltd structure is the right choice. It’s flexible, cost-effective, and aligns with how private companies operate in most other jurisdictions. If you’re unsure which structure suits your situation, learn more about what an incorporated business is and understand the difference between registration and incorporation.
Post-Incorporation Compliance Obligations
Incorporating a company is straightforward, but many overseas founders underestimate the ongoing compliance obligations that follow. These obligations are serious, and failing to meet them can result in penalties, director disqualification, or company deregistration.
Key ongoing obligations include:
Annual ASIC Review: Every company must pay an annual review fee to ASIC and confirm that its details are up to date. This fee is due within one month of the company’s registration anniversary.
Financial Reporting: Depending on the size and type of company, you may need to prepare and lodge financial statements with ASIC. Small proprietary companies are generally exempt unless directed by shareholders or ASIC.
Tax Obligations: All Australian companies must lodge an annual tax return with the ATO, even if the company made no income. Companies are taxed at the corporate rate (currently 25% for eligible small businesses). You’ll also need to consider GST registration, PAYG withholding if you have employees, and other tax obligations.
Company Records: Companies must maintain registers of members, directors, and shareholders, as well as minutes of meetings and financial records. These records must be kept at the registered office or another accessible location.
Director Duties: Directors have legal duties under the Corporations Act, including acting in good faith, avoiding conflicts of interest, and preventing insolvent trading. These duties apply to all directors, including those based overseas.
Failing to meet these obligations can result in late fees, penalties, or ASIC taking enforcement action. For overseas founders, managing compliance from abroad can be challenging, which is why many engage local accountants, lawyers, or company secretaries to stay on top of obligations.
Risks of Registering Incorrectly
Getting the incorporation process wrong can create significant problems. Common mistakes include:
No Australian Resident Director: If you incorporate without meeting the resident director requirement, ASIC may refuse to register the company or issue a compliance notice requiring you to appoint one. Operating without a compliant director structure can also void contracts or insurance policies.
Using an Incorrect Structure: Incorporating as the wrong type of company, or registering when you should have incorporated can create tax, liability, and operational issues. Understanding when to incorporate is essential before you commit.
Ignoring Ongoing Obligations: Incorporation is not a set-and-forget exercise. If you fail to pay annual fees, lodge tax returns, or update company details, ASIC can deregister the company, which creates legal and financial complications.
Misunderstanding Foreign Company Rules: If you register as a foreign company instead of incorporating locally, different rules apply. You’ll need to lodge financial reports from your home jurisdiction and comply with Australian laws, which can be more complex than incorporating a local entity.
These mistakes are avoidable if you understand the requirements upfront and get professional advice before you register.
How Much Does It Cost to Incorporate a Company in Australia?
The cost to incorporate a company in Australia includes ASIC fees and, in many cases, professional service fees.
ASIC’s company registration fee is currently $583 (as of 2025). This is a one-off fee paid at the time of incorporation. The annual review fee, payable each year, is $325.
If you use a professional service to handle the incorporation, such as Lawpath’s company registration service you’ll pay an additional fee for preparation, lodgement, and compliance support. This can range from a few hundred dollars to over a thousand, depending on the complexity of your structure and the level of support you need.
While it’s technically possible to incorporate a company yourself using ASIC’s online portal, most overseas founders benefit from professional assistance. It ensures the application is completed correctly, all documents are in order, and you understand your ongoing obligations from day one.
What Does It Mean When a Company is Incorporated in Australia?
When a company is incorporated in Australia, it becomes a separate legal entity governed by Australian law. It can enter contracts, own assets, sue and be sued, and operate independently of its shareholders and directors.
Incorporation also means the company is subject to Australian tax law, employment law, consumer law, and ASIC’s regulatory oversight. Even if your founders and operations are based overseas, an Australian company must comply with Australian legal obligations.
This is different from simply registering a business name or operating as a sole trader. Incorporation creates a legal structure with limited liability, formal governance requirements, and a higher level of regulatory scrutiny. For more detail, explore the benefits of setting up a company in Australia.
Final Thoughts for Overseas Founders
Incorporating a company in Australia as an overseas founder is entirely possible, but it requires careful planning and an understanding of local legal requirements. The Australian resident director rule, registered office requirement, and ongoing compliance obligations are non-negotiable, and getting them wrong can derail your plans.
If you’re serious about establishing an Australian presence, start by ensuring you can meet the director and office requirements. Engage local advisors who understand both Australian law and your home jurisdiction. And most importantly, treat incorporation as the beginning of a compliance journey, not a one-time task.
Australia offers significant opportunities for overseas businesses, but success requires more than just registering a company. It requires understanding the legal landscape and building a compliant, sustainable structure from day one.
Ready to get started? Register your Australian company through Lawpath and ensure your incorporation is done right from the beginning.
F.A.Q.s
What is the difference between registering a company and incorporating a company?
In Australia, registering a company and incorporating a company mean the same thing legally. Incorporation occurs when a company is registered with ASIC and comes into existence as a separate legal entity. This is different from registering a business name, which does not create a company or provide limited liability.
How much does it cost to incorporate a company in Australia?
ASIC charges a one off company registration fee of $583 as of 2025. Companies must also pay an annual ASIC review fee of $325 each year. Additional costs may apply if you use a professional service to handle the incorporation.
What does it mean when a company is incorporated in Australia?
When a company is incorporated in Australia, it becomes a separate legal entity governed by Australian law. The company can enter contracts, own assets, and be responsible for its own debts. Shareholders generally have limited liability, meaning their personal assets are protected.
