Reminders when running your company
1) Update ASIC within 28 days of certain key changes to the company's details
Key changes can include:
- names and addresses of its directors and secretary
- registered office details
- share details
- members’ details (names and addresses but only regarding proprietary companies)
- changes to the company's annual statement.
It’s important that companies review and respond to their annual statement and pay their fees on time. If a company doesn’t do this it can lead to late fees being imposed, having a ‘notice’ of deregistration being published about the company on the Insolvency notices website and even deregistration of the company by the Australian Securities and Investments Commission (ASIC).
ASIC can also issue late fees if your company doesn’t lodge other key documents on time.
Find out how to inform ASIC of these changes to your company.
What to do...
- Check out the Keeping your company details up-to-date page on ASIC's Small Business Hub.
- Read the ASIC’s Your company and the law page for more on what changes ASIC needs to be notified about, and which forms to use.
- Watch ASIC’s How to update your company details video.
2) Ensure business activity statements (BAS) are paid and lodged on time
Need helping remembering your BAS dates?
- Download the small business tax calendar.
- Check the key due dates on the Small Business Newsroom.
- Download the ATO App to find key dates for tax.
3) Be aware of any debts and use payment arrangement or deferral services to manage debts
If you’re the director of a company or the owner of a business, you’ll need to be aware of any debts the business owes.
To ensure debts are paid on time, you may first need to do some calculations on your own to work out a payment plan that suits you.
As a director of a company, if you allow your company to continue to trade at a time when it is unable to pay its debts, as and when they fall due, you may be trading whilst insolvent and be committing a criminal offence.
The ATO's Payment arrangement calculator can help you work out how quickly you can pay off a tax debt, including the interest you’ll be charged. The longer you take to pay off your debt, the more it will cost you in interest. Now that you’ve calculated a suitable payment scenario you need to propose your plan to the ATO.
If your debt is less than:
- $25,000 - you can set up a payment plan via a 24 hour automated phone service on 13 72 26 or the ATO online payment plan service.
- $50,000 - you can phone the ATO on 13 11 42 or set up a payment plan using the ATO online payment plan service.
- If you debt is more than $50,000, call the ATO on 13 11 42 between 8.00am and 6.00pm weekdays to discuss a payment plan.
What to do...
- Speak with your accountant or financial planner for advice on managing debts to ensure your proposed plan is relevant to your business situation and circumstances. Visit our Advisory Services tool for low-cost advisers.
- Check out our Financial templates for practical templates like profit and loss statements, balance sheets and cash flow statements.
- Read our Business finances topic for information on managing cash flow and your finances.
4) Keep financial records
According to the Corporations Act 2001 (Corporations Act), if you operate your business as a company, you’ll have to keep financial records for seven years. Your records need to correctly document the financial position and performance of the company.
If you operate your business as a sole trader, you’re required to keep financial records for at least five years, either electronically or on paper. They also must be in English, or in a form that can easily be converted to English.
What to do...
- Check out our Set up a basic bookkeeping system page for information on bookkeeping.
- Check out ASIC's guidance about which records your company should keep on the Small Business Hub.
- Read about employees and record keeping, including creating timesheets and payslips.
5) Make sure you know and comply with all your obligations as a director of a company
If you’re a director or the secretary of a small company, you must comply with your obligations under the Corporations Act 2001, even if you assign someone else to look after the company's affairs.
As a director, you’ll have to guide and monitor the management of the company—you should only agree to become a company director or secretary if you are willing, able and have enough time to put in the effort.
Avoid situations where someone tries to appoint you as a director or secretary by promising that 'you won't have to do anything' or 'just sign here, it will be fine'. If you do this, you could potentially be exposing yourself to serious personal liabilities if you accept such a role.
To help you decide if being a director or secretary of a company is something you’d feel comfortable with, here is a list of your legal obligations under the Corporations Act 2001.
While this list does not cover every duty you may have or every possible circumstance, you are unlikely to get into trouble if you:
- are honest and careful in dealing with the company and on its behalf with others
- understand your legal obligations
- ensure complying with your legal obligations is an in-built part of your business model
- are aware of your company's financial position and performance
- ensure your company can pay its debts on time
- ensure your company keeps proper financial records
- understand that you have to give the interests of the company, its shareholders and its creditors top priority
- act in the company's best interests (even if your actions may not be in your own best interests)
- use information you get through your position in the company properly (in the company’s best interests)
- get professional advice or more information if you are in doubt about any of your obligations.
What to do...
- Check out ASIC's Guide for Small Business Directors for more about your legal obligations as a company director.
- Read our Differences between a sole trader and a company information to find out more, including your legal responsibilities and tax differences.
- Search our Advisory Services tool to find a business adviser in your area.