Establishing a Business in Australia
Before choosing Australia as the home for a new business there are a number of things to consider.
Generally the choice will be between setting up a branch of a foreign parent company or setting up a separate Australian company as a subsidiary, and the final decision will come down to the specific circumstances and needs of the foreign business.
In the case that an Australian subsidiary company is to be set up Australian Corporate Law requires at least one director to be an Australian resident. Similarly, if a branch is to be set up, Australian Corporate Law requires a local agent/officer to be an Australian resident.
This tends to pose a problem for foreign companies that may not have contacts in Australia to fulfil these essential roles.
Foreign businesses from around the world including France, Germany, UK, Sweden, Hong Kong, Taiwan, US, Israel and NZ currently use Ecovis Clark Jacobs’ resident director services. These businesses also benefit from our full suite of services including structuring, tax, accounting, bookkeeping, payroll and related business services as examples of add-on services.
Additional services include:
- If a subsidiary is to be incorporated, we arrange that through the Australian Securities and Investments Commission (ASIC);
- If a branch is to be established, we register the foreign parent for an Australian Registered Business Number (ARBN) through ASIC;
- In either case we arrange registrations with the Australian Taxation Office (ATO) for the new company or branch in terms of a mandatory Tax File Number (TFN), Australian Business Number (ABN), Goods and Services Tax (GST) and Pay as You Go Withholding (PAYG);
- Advising on and setting up the local accounting systems in relation to Australian requirements in concert with our bookkeeping arm ECJ Online;
- Managing and providing advice on your monthly/quarterly/annual accounting and tax compliance and reporting obligations;
- Providing accounts payable/receivable and payroll services (fully outsourced if required);
- Advising on strategies to minimise reporting and lodgement requirements where appropriate and/or where requested by you (e.g. ASIC Audit Exemptions);
- Advising on strategies to assist in the growth of your Australian operations by providing strategic advice where requested/appropriate;
- Analysing the performance of the local business and employees for the purpose of providing impartial advice where requested/appropriate; and
- Ensuring that Board of the foreign parent company remains informed and is able to retain complete control of the local company or branch.
The Importance of Local Knowledge
It takes a ‘local’ who is familiar with the Australian business and regulatory landscape to deliver the requisite expertise, knowledge and contacts that you need for your Australian operation to be developed and running as soon as possible.
- Ecovis Clark Jacobs can introduce extra layers of expertise via our extensive network of banks/lenders, insurers, lawyers, valuers or any other experts you may require from time to time on top of our own tax, accounting and related advisory skills;
- Ecovis Clark Jacobs has quick access to international expertise and insights about the interaction of Australian tax with your home jurisdiction through our global professional network.
How to Get Started
It is important to note that the role of director of an Australian subsidiary company or local agent of a foreign company trading in Australia involves specific and significant personal liabilities and risks taken on by the individual director themselves. Therefore, we have specific documentation, information and insurance requirements that must be satisfied including:
- Understanding the history (if any), plans, scope of activities, and parent company interaction and any other relevant factors that may affect the role of director or local agent;
- Liaising with you by phone and email (or in person if possible) to ensure that all parties have the required information and understanding to carry out their roles and to ensure that the parties are comfortable with each other;
- Recommending D&O Insurance policies covering Australia in the case that global D&O insurance is not already in place;
- Organising a Deed of Access and Indemnity for review and signature; and
- Providing specific service contacts to serve your needs in Australia