It is a little known fact that when registering a company you can either choose a company name or, you can elect to use the company’s Australian Company Number (ACN) for example 000 000 000 Pty Ltd.
To cover the basics, an ACN, is a unique nine-digit number generated by a special algorithm, which is issued to every company that is registered under the Australian Corporations Act 2001. An ACN must be shown on a range of company documents and items which will be outlined a little later in this article. The purpose of the ACN is to ensure adequate identification of companies. Upon registration with ASIC (Australian Securities & Investments Commission), every company is issued with a new ACN.
By law, an ACN must be displayed on a number of documents, including:
- business letterheads
- official company notices
- accounting statements, such as invoices
- any documents you lodge with ASIC
- cheque, or any documents that represent a legal amount of payment
- written ads making a specific offer that can be accepted (such as by completing an order form).
- receipts (if they’re not machine generated, e.g. from a cash register)
- orders for goods and services
If your company also registers for an ABN for your business, then your ACN will form part of your ABN. In these cases, you won’t need to display your ACN if your documents already display your ABN and company name.
It can be advantageous to use the company ACN as the company name, as you will be able to register your company immediately, without concern for company name restrictions.
What are the restrictions on company names?
Company names that are already registered to a company or a business, cannot be used for your company. Certain words require special approval before they can be utilised in your company name. You can find more information on company name restrictions on the ASIC website and a little further down in this article.
What if I need to change my company name?
You can alter the name of your registered company. Importantly, the new company name must be available.
A company name is available when:
- the company name is not identical or very similar to, a company name which is already in use by another company, and
- the name is not inadmissible for registration.
In order for a new company name to be admissible it must:
- not be objectionable to individuals of the public or in any way advocate or suggest unlawful activity.
- not include any prohibited words such as bank, consumer, or ANZAC etc. (unless Ministerial or Public Authority consent has been obtained)
- not imply a link to government or other organisations where such a relation does not currently stand;
On choosing a company name and determining that it is available, you must pass a special company name change resolution and lodge a Form 205 Notification of resolution through ASIC.
ASIC will advise you when your name change is accepted or rejected.
At the time of writing this article, the ASIC fee for changing a company name was $387.00.
What if the company name I want to use is the same as my business name?
If the name you wish to use for your company is already in use by your business, you can still use that name however, you must substantiate that you are the owner of the business name.
In summary, there are a number of reasons why you might elect to use the ACN of your company as your company name, not the least being that you will not be faced with restrictions of any kind and you can register your company without delay. Recent data we have gathered on our client base shows that 30% of our clients have used this method of naming their company. One of the notable disadvantages of this method of naming your company is that if you choose to change your company name at a future date, it will cost you in terms of time and the standard ASIC fee.