What is Pty Ltd (Proprietary Limited Company)?
A proprietary limited company is the most common Australian business entity. Owners' liability is limited to their share capital, and the company is a separate legal person. Maximum 50 non-employee shareholders. Must have at least one Australian-resident director.
Example
Acme Pty Ltd has two shareholders (a husband and wife), one director, and trades as a software consultancy. It pays company tax, lodges quarterly BAS, and pays superannuation for the director.
How Pty Ltd (Proprietary Limited Company) works in Australia
Setting up a Pty Ltd takes 1–2 days through ASIC (asic.gov.au) or via a service provider. Required: company name reservation (free), at least one director who is ordinarily resident in Australia, registered office in Australia, share structure, and the company constitution (or default 'replaceable rules').
All directors must obtain a Director ID through ABRS before being appointed. Annual obligations include the ASIC Annual Review (anniversary of incorporation), the company tax return, BAS for GST, and STP for payroll.
Related terms
The Australian Company Number is the 9-digit identifier ASIC issues to every registered Australian company. It must appear on company stationery, websites, and public documents. Companies also have an ABN; the ABN typically incorporates the ACN.
The Australian Business Number is an 11-digit identifier issued to businesses by the Australian Business Register. Without an ABN, payers must withhold 47% from your invoice. Required for GST registration, business name registration, and most B2B trading.
Company Tax is the federal tax Australian companies pay on taxable income. The base rate is 25% for 'base rate entities' (turnover under A$50 million and ≤80% passive income). All other companies pay 30%. There is no separate state-level company tax.
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