The difference between business name registration and company registration

See an updated (most current) version of this post here. 


Starting a business?

Are you just starting a new business and you’re not sure whether you only need to register a business name or if you need to register a company?
This is one of the most frequently asked questions we get at Shelcom. Although you should always seek advice from a solicitor, here is a brief summary to help you gain a better understanding of the differences.

The difference between business name registration and company registration:
Registering a Business Name is not the same as setting up a business structure or registering a company. A Business Name can also be called a trading name. This is the word or phrase by which your customers can identify your business.

In Australia, a Business Name is registered on a state by state basis, therefore a competitor in a different state can legally register a business under the same name. Before lodging an application for a Business Name you must first check its availability. You can do this easily on our website by simply typing in your chosen name into the ASIC name search.

When Registering a Business Name it is very important to understand that:

• This does not create a legal entity or allow for privileges such as a corporate tax rate or limited liability
• There is no asset protection
• A Business Name has NO legal status so the responsibility is on the owner to repay the debts incurred

For people starting out in business, operating under a business name is the most common approach as the establishment costs are low and the ongoing process is neither complicated nor expensive.

If you are wanting Australia wide recognition for your business, then registering a business name in each state would certainly become expensive and a logistical nightmare if you do not operate in every state and territory. Setting up, or registering a company, may be a more cost-effective, and a simplified way to secure your business’ name across Australia.

A company is an independent legal entity able to do business in its own right. It has shareholders, who own the company, and directors, who run the company.

There are several options for a proprietor when setting up a company. There are two types of proprietary companies and four types of public companies that can be registered under the Corporations Act. You can read more about the types of companies here:

If you are unsure of which business structure is the right choice for you please take 60 seconds to fill out our Free Business Structure Wizard:

Before applying to register a company you must ensure that you understand all of your legal obligations.
If you’d like more details on how to Register a Company please follow this link:

See an updated (most current) version of this post here. 

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