Question 1

How do I register a business name in Melbourne?

Accepted Answer

To register a business name in Melbourne, you first need an Australian Business Number (ABN). You can apply for an ABN through the Australian Taxation Office if you don't already have one. Once you have an ABN, you can register your business name online through the Australian Government's Business Registration Service or ASIC's online system. Before applying, check whether your chosen name is available on the business names register. Registration fees are $47 for one year or $108 for three years, and you must pay within 10 business days of approval. If you prefer, you can authorise an accountant, lawyer, or other representative to handle the registration for you.

Question 2

What is the difference between a business name and a company?

Accepted Answer

A business name is the trading name your business operates under, while a company is a specific legal business structure that must be registered as a separate legal entity. A business name is simply what customers know you by, whereas a company is a formal registration that creates an entity distinct from its owners.

You must register a business name if you operate under a name different from your own personal name, unless you're a registered company trading under its registered company name. A company, by contrast, requires formal registration and has ongoing legal obligations for its office holders.

The two registers are separate. If you operate as a company but want to trade under a different business name, you'll need to register both your company and that business name separately. For Melbourne businesses, if you're unsure which structure suits your needs, consider speaking with a company secretarial services provider listed on LawConnect who can advise on the best approach for your situation.

Question 3

How do I apply for an ABN in Melbourne?

Accepted Answer

To apply for an ABN in Melbourne, you can register online through the Australian Government Business Registration Service. The application is free and you can complete it entirely online. When applying, you'll be asked questions to determine whether you're entitled to an ABN. If you're a sole trader, providing your tax file number will speed up the process, while companies should provide their Australian company number. You can apply for a business name and register for taxes like GST at the same time if needed. For professional guidance specific to your business structure, you may wish to consult with a company secretarial services provider who can assist with your registration requirements.

Question 4

Do I need an ABN to run a business?

Accepted Answer

Whether you need an ABN depends on your business structure and activities. If you're operating as a sole trader or partnership, you'll generally need an ABN if your business turnover reaches certain thresholds or if you're required to register for GST. Companies must obtain an ABN as part of their registration process. You may also need an ABN if you employ staff or need to register for PAYG withholding. Not everyone is entitled to an ABN, so you'll answer eligibility questions when applying. The application is free and you can apply for a business name and tax registrations like GST at the same time. If you're unsure whether your specific business requires an ABN, it's worth seeking advice from a company secretarial services provider who can assess your circumstances.

Question 5

What are a director's legal obligations in Melbourne?

Accepted Answer

Directors in Melbourne have legal obligations under the Corporations Act to act in the best interests of their company and its shareholders. Key duties include acting honestly and carefully, understanding the company's financial position and operations, ensuring the company can pay its debts on time, and keeping proper records. Directors must make decisions in good faith for proper purposes, avoid conflicts of interest by disclosing any material personal interests, and refrain from using their position for personal gain. They must also understand applicable laws and act to address financial difficulties if they arise. Breaching these obligations can result in serious penalties. It's generally advisable to seek professional advice when needed to ensure compliance with your specific circumstances.

Question 6

When do I need to register for GST?

Accepted Answer

You must register for GST when your business turnover reaches $75,000 or more. The only exception is if you operate a taxi or limousine service, in which case you must register regardless of turnover. Once you're required to register, you need to have an Australian Business Number before registering for GST, and you must complete your GST registration within 21 days of becoming eligible. If you fail to register when required, penalties may apply. For company secretarial assistance with your GST registration in Melbourne, LawConnect can connect you with local firms that specialise in this area.

Question 7

What does a company secretary do in Melbourne?

Accepted Answer

A company secretary in Melbourne is responsible for ensuring your company complies with all relevant laws and regulations, including the Corporations Act 2001. They act as the chief administrative officer, organising board meetings, preparing documentation, and maintaining accurate corporate records. Company secretaries also serve as a liaison between the board, management and shareholders, ensuring information flows efficiently and decisions are properly recorded and implemented. They must act in the company's best interests and understand the company's operations, financial position and legal obligations. If you need professional guidance on company secretarial services in Melbourne, LawConnect has 8 local firms listed that can assist you, including 1 offering a free consultation.

Question 8

What is a discretionary trust and how does it work?

Accepted Answer

A discretionary trust is a legal arrangement where a trustee holds assets on behalf of beneficiaries, with the key feature being discretion in how income and capital are distributed each year. Unlike fixed trusts with predetermined distribution percentages, discretionary trusts allow the trustee flexibility to decide annually how to allocate profits among beneficiaries.

This flexibility can provide tax planning advantages. For example, if your business generates substantial income in a particular year, the trustee may distribute more to beneficiaries in lower tax brackets to minimise overall tax liability. Conversely, distributions can be adjusted downward if profits decline.

A trustee manages the trust's assets and makes distribution decisions, while beneficiaries receive income and capital as determined by the trustee. The trust itself is not a separate legal entity, though it may operate a corporate trustee for liability protection purposes.

Discretionary trusts are commonly used by small to medium business owners for asset protection, wealth management flexibility, and succession planning. For advice tailored to your specific circumstances in Melbourne, you may wish to consult with a company secretarial services provider listed on LawConnect.

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