There are a lot of considerations for global businesses when setting up a business in Australia especially when you are unfamiliar with the processes and systems. Opening an Australian business bank account is one.
Every new business, company, partnership or trust, that opens and operates in Australia must be the holder of an Australian business bank account.
Australian bank accounts can receive money from around the world and can pay expenses, payroll and taxes directly from the account.
Before you open your Australian business bank account
- Before you open your Australian business bank account
- Things to think about before opening a bank account
- Documents you need to open an Australian business bank account
- The Australian AML/CTF Act
- What’s the next step to opening an Australian business bank account?
You need to set up your company in Australia and list with the relevant government bodies with a registered Australian address before you open your new Australian bank account.
What you need before you can open your bank account –
- A Company name – the company name must match the company name registered with the Australian government.
- Tax File Number (TFN) – This is your unique number identifying your business in its dealings with the Australian Taxation Office.
- Australian Business Number (ABN) – An ABN is the registered business number with Australian Securities and Investments Commission (ASIC). This is Australia’s corporate regulator. You can apply for an ABN at the same time as your TFN.
- Set up for Goods and Services Tax (GST) – You must register for GST if your business has a turnover of AUD75,000 per annum or $150,000 per year for non-profit organisations. If your turnover is less than these limits it is optional.
Things to think about before opening a bank account
There are a few factors you need to think about before you open your Australian business bank account.
Who will be the primary account holder/s?
This person will have responsibility for and access to the bank account. They will need some form of identification such as passport, drivers license, health card to verify their identity.
Australian banks use a 100 points system for identification – each documentary proof has a number of points attached to it with key IDs such as passports and drivers license, valued with higher points than other identifications.
Who will have access to the bank account and funds
Who do you want to have access to the funds, such as to pay bills, suppliers and for payroll? We suggest you choose people who are responsible, and it is part of their job description such as the financial controller.
Primary account holders can grant access to different people with varying levels of access and offers you a way to secure and monitor bank transactions.
Choosing the right bank account for your business
Before you begin your research for the best business bank account for your company, it is a good idea to list the features and services your business may need now and in future – services such as international banking, electronic funds transfer, credit card facilities, overdrafts and multiple foreign currencies.
There are websites which list the bank accounts available for business and itemises their fees, restrictions, interest rates. One such website, www.finder.com.au, has click-throughs to each banks website so you can research in-depth its service offerings such as overdraft options, interest rates, business loans and EFTPOS facilities.
An alternative is Canstar, an online finance comparison site with expert ratings in finance-related products and services. Find business bank account comparisons here.
Documents you need to open an Australian business bank account
Once you have selected the appropriate bank account for your business, most banks will allow you to start the set-up process online.
This will give you a head start on the process and provide you with an account number and BSB number. However, you will need to complete the bank account set up when you arrive in the country in person with the required documents to gain full access to the account.
If you are a non-resident, you can still open the bank account in Australia, but your company must be registered in Australia.
To complete the setup of the bank account in most cases, you will need:
- Proof of ID of the company directors and shareholders with more than 25% holding – this can include your passport, drivers license or other identification. Remember, Australian banks use a 100 points system for identification, so ensure you present the correct number of points to completely satisfy the requirements of identification. Important to note: Each bank has different requirements when setting up a business bank account (not to mention, that they keep changing) so we highly recommend you get a list of requirements from your bank before embarking on the process.
- Your proof of ID documents MUST BE CERTIFIED by the Australian Consulate or a Notary.
- Your documents should be in English, otherwise, the bank will have to translate them, and this may delay the set up of your business bank account.
- Some banks will request the overseas director to attend the Australian bank in person with their documents, however, banks such as St George Bank will allow a representative (Penguin Management) to bring in your certified documents.
- Your business certification or business registration from ASIC (in the form of a certificate), or in the case of a trust, evidence that the trust exists.
- The ABN or ACN with your business’ registered office address.
We highly recommend you check with your chosen bank what documentation you will need as it can vary between banks and financial institutions (not to mention, their requirements may change as well).
The Australian AML/CTF Act
The Anti-Money Laundering and Counter-Terrorism Financing Act 2006 is part of a legislative package which aligns Australia with international standards to deter money laundering and terrorist financing.
It covers the financial sector, bullion dealers and other professionals or businesses that provide services under the Act.
A statutory review of Australia’s AML/CTF Act identified sections where urgent reform was needed and have committed to tightening these laws in two phases, one by the end of 2018 and the second in 2019.
These changes may affect how you conduct business in Australia and opening a bank account, so contact your bank to discuss its requirements.
What’s the next step to opening an Australian business bank account?
As part of our setting up business in Australia services, Penguin Management can give you a list of requirements when setting up a business bank account in Australia.
We also offer the service of opening a bank account to save time and reduce your stress, so your business can hit the ground running when it officially opens for business in Australia.
Call us on +61 2 8298 5301 or complete the form and we’ll get back to you.
On a roll? Read more –
Need some advice on choosing the right business structure for your Australian operations? Branch versus subsidiary company is a complex decision and needs careful thought and planning for the right structure.
Launched in February 2018, the NEW Payments Platform (NPP) will give Australian businesses and consumers access to a quicker, more useful, data-rich payments system. What’s in it for me and my business?