Australian Company Law: Corporations Act 2001 Explained (2026)

Updated October 2026. ASIC fees shown apply from 1 July 2026. This is general information, not legal advice.

The Corporations Act 2001 (Cth) governs Australian companies and is administered by ASIC. Whether you are registering a company, acting as a director or managing compliance, understanding this framework is essential.

Company types

Type	Abbreviation	Key feature
Proprietary limited	Pty Ltd	Up to 50 non-employee shareholders; the most common structure for SMEs
Public company	Ltd	Can raise capital from the public; heavier reporting obligations
Company limited by guarantee	Ltd	Commonly used by not-for-profits

Registering with ASIC

1. Choose a company name: a proprietary company’s name must end in “Pty Ltd”; check availability with ASIC.
2. Appoint directors: a proprietary company needs at least one director who ordinarily resides in Australia, and every director needs a Director ID.
3. Decide shareholders and share structure: classes of shares, voting rights and any shareholders’ agreement.
4. Register with ASIC (Form 201) and receive your ACN. The registration fee for a Pty Ltd is $636 from 1 July 2026.
5. Register for tax: ABN, TFN and, where required, GST and PAYG withholding with the ATO.

Directors’ duties

• s180 Care and diligence: act with the care and diligence of a reasonable person (the business judgment rule may apply).
• s181 Good faith: act in good faith in the company’s best interests and for a proper purpose.
• s182–183 Improper use: do not misuse your position or company information.
• s191 Material personal interests: disclose them to the other directors.
• s588G Insolvent trading: do not let the company incur debts when it is insolvent.

Dividends & franking credits

Australian companies can pass the benefit of company tax paid to shareholders through franking credits. A fully franked dividend carries a credit at the company’s tax rate (30%, or 25% for base rate entities), which shareholders can use to reduce their own tax.

ASIC annual review fees from 1 July 2026

Company type	Annual fee
Proprietary company	$342
Special purpose company (e.g. SMSF corporate trustee)	$70
Public company	$1,591

Late payment fees apply if the annual review fee is not paid within two months of the review date.

Financial reporting

• Small proprietary companies are generally not required to prepare audited financial reports. A proprietary company is large if it meets at least two of: consolidated revenue of $50 million or more, consolidated gross assets of $25 million or more, or 100 or more employees.
• Large proprietary companies must prepare audited financial reports and lodge them with ASIC each year.
• Public companies must prepare audited financial reports; listed entities must also meet ASX Listing Rules.