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  • #979604
    Jimmy12
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    Hi there,
    I have a question regarding the parent company and subsidiary company.
    I want to structure a company with a parent company called parent pty ltd, which i need to register with ASIC.
    Then I want to start a business in clothing with a business name eg: clothing.
    I also have a plan to do business in technology with a name called “technology” all under parent.pty.ltd.

    Do I need to register clothing and technology under ASIC to do business in that name?
    I will have separate websites for clothing and technology in the future.

    Is this a good to start a business like this. Any advice will be appreciated.

    #1115606
    Divert To Mobile
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    Anything you trade as has to be registered.
    Your structure looks to be designed to protect the activities of one business from the other. If that is not the objective you can operate a single company (parent company) and multiple trading names.
    parent trading as – xyz. This will cost less in setup and admin but offer less protection.

    Steve

    #1115607
    Kennethti
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    What is your ultimate goal?

    If you have two entities this also means doubling on the annual fees as well as doubling up accounting fees.

    Certainly there are some asset protection strategies in place but this is a strange way to start up a business.

    #1115608
    Jimmy12
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    Thanks Steve and Kennethi.
    My goal is to minimize the company registration fees as I dont wan to spend registration fees on multiple company names. Is it possible in this way?

    I want to start a company in my filed where i will take contract jobs.
    My wife want to do some business in clothing field. The company name should reflect the activity it doing. I thought of registering a parent company and 2 subs under it. Not sure its a foolish idea. can anyone suggest?

    or can anyone suggest what is the best way to do this?

    George

    #1115609
    Jimmy12
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    Thanks , but what is the best way to start a business if I want to do business in multiple names.

    My goal is to reduce the registration and other cost for the company. If I register them as multiple company i need to pay multiple registration charges and administrative cost.

    I want to start a business in a contracting field and my wife want to start a business in clothing. I want the name should reflect the business we do. Thats why i thought of registering a parent company do business under it with multiple names with same ACN number, is it possible?
    Can anyone advice please..

    George

    #1115610
    Kennethti
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    Bulls, post: 129810 wrote:
    Thanks , but what is the best way to start a business if I want to do business in multiple names.

    My goal is to reduce the registration and other cost for the company. If I register them as multiple company i need to pay multiple registration charges and administrative cost.

    I want to start a business in a contracting field and my wife want to start a business in clothing. I want the name should reflect the business we do. Thats why i thought of registering a parent company do business under it with multiple names with same ACN number, is it possible?
    Can anyone advice please..

    George

    Hello George,

    You should speak with an accountant about what’s the best way to implement your business as well as what’s the best asset protection strategy.

    Technically speaking, you can start a Pty Ltd company and hold multiple business names under the Pty Ltd company. Keep in mind that this does not mean that each business name is a separate entity. It’s only a different trading name. If you do this, you cannot treat the businesses as entirely separate from each other and this may mean that any losses or liabilities incurred will be shared. All of your invoices must show the Pty Ltd company’s name including its trading name.

    If you want to keep the businesses entirely separate and insulate the business from each other then you should consider establishing multiple entities – however it’s still not entirely a good idea having a “parent” and “subsidiary” company – this usually means that the parent wholly or partly owns the shares in the subsidary company – and this means that the parties are still connected to each other somehow.

    Again, speak to an accountant – get professional advice.

    #1115611
    relentless
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    if your only purpose is to reduce costs then just do as Steve has suggested. Register one company and then you can register multiple trading names under that company for each of your businesses to provide services under.

    You register each trading name with Fair Trading

    #1115612
    Jimmy12
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    Hey Guys thanks again for the advice. I will definitely see an accountant before starting, but i need to have an idea before doing so, hence I need few more details.

    Yes my idea is to save cost. If I set up the company like relentless suggested , can I convert that to a ltd company ( different entity ) at a later stage.

    As kennethi said “All of your invoices must show the Pty Ltd company’s name including its trading name.” Can you give an example how it looks like ( xyz company a parent group companies) something like this.

    So if i register a company and got the ACN number, I can register multiple business names under it and trade with that name for different type of business am i right?

    Thanks again for the advice .. George

    #1115613
    Divert To Mobile
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    BUT.

    For a bit more, you can set up a discretionary trust and have 2 trading names below that.
    This is a great tool for flexible distribution of income to minimise tax liability.

    Steve

    #1115614
    JacquiPryor
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    You register each trading name with Fair Trading

    Firstly – just to clarify this comment – no you don’t, anymore… as from 28 May 2012 you register your business names also with ASIC, no longer the Fair Trading or Consumer Affairs office in your state.

    “All of your invoices must show the Pty Ltd company’s name including its trading name.” Can you give an example how it looks like ( xyz company a parent group companies) something like this.

    Essentially you would display it as “Parent Company Pty Ltd t/as “Clothing Business Name”.

    If you are looking to register only one pty ltd – then you won’t have a ‘group of companies’ – you will have a single company trading by multiple names. As Kenneth pointed out, this means that the businesses are not really separate – they all feed into the one ABN and ‘point’ – ultimately, sharing income/losses/taxes etc. So, whilst it might save a few dollars a year on ASIC fees it might not be the best, financially, in the long run.

    So if i register a company and got the ACN number, I can register multiple business names under it and trade with that name for different type of business am i right?

    Yes – each business name could be registered (owned by the Company) and they can be different types of businesses… so long as the company name is displayed as well as business name on invoices etc as per the above.

    #1115615
    julius
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    I have two questions about this:

    (1) are you allowed to when dealing with clients for company ChildA
    represent yourself as company ChildA (including logos and trademarks) but just in fineprint state your a subsidiary of ParentCompany? Im talking about on invoices etc. Or must you mainly represent yourself as ParentCompany?

    (2) Is it very hard to then seperate the child subsidiaries (so that their independent entities) at a later date?

    #1115616
    Mark Jeffreson
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    julius, post: 153356 wrote:
    I have two questions about this:

    (1) are you allowed to when dealing with clients for company ChildA
    represent yourself as company ChildA (including logos and trademarks) but just in fineprint state your a subsidiary of ParentCompany? Im talking about on invoices etc. Or must you mainly represent yourself as ParentCompany?

    (2) Is it very hard to then seperate the child subsidiaries (so that their independent entities) at a later date?

    Hi Julius

    (1) There is no need to identify the parent company at all, however all your trading “stationery” must properly identify the entity that your trading partners (customers and suppliers) are dealing with. Trademarks, logos etc are another matter. They may be used either as the property of ChildA outright, or under licence from another entity if it owns those assets.

    (2) No, but you need to consider the tax consequences of “carving out” subsidiary companies and/or their assets. Particularly Capital Gains Tax.

    Cheers
    Mark

    #1115617
    julius
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    Mark Jeffreson, post: 153610 wrote:
    Hi Julius

    (1) There is no need to identify the parent company at all, however all your trading “stationery” must properly identify the entity that your trading partners (customers and suppliers) are dealing with. Trademarks, logos etc are another matter. They may be used either as the property of ChildA outright, or under licence from another entity if it owns those assets.

    (2) No, but you need to consider the tax consequences of “carving out” subsidiary companies and/or their assets. Particularly Capital Gains Tax.

    Cheers
    Mark

    Thanks Mark, very helpful

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