QLD Is It Legal to Run Business Without ASIC Registration?

Discussion in 'Commercial Law Forum' started by Angela Brisbane, 17 June 2016.

  1. Angela Brisbane

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    This does concern a legal matter currently going through a tribunal but my question is basically whether trading names are still valid (without a business name) and whether there's any way to check whether a company lodges BAS statements, income tax returns, etc. through ASIC, in other words, whether I can search for proof that a particular company is still operating a going concern under that particular ABN.

    The background is that there is a bad debt dispute between us, the supplier, and the debtor. The debtor is claiming that a previous lessee of the property is responsible for our invoices, not the owner. However, I've found through ABN Lookup and ASIC that the owners have set up 2 trust funds and both of these have the property listed as a trading name, but not a business name and these are active. These 2 entities aren't listed on ASIC.

    The company also lists the property as a business name and this is registered with ASIC and also current. So basically the same family has 3 separate entities (with 3 separate ABNs) for the same business property, 1 is a business name and registered, the other 2 are trading names and not registered, but the ABN is current for all 3. Previous business names were ended for the trading name entities (but all of these were the same property as well).

    What does "current" actually refer to on ABN Lookup? Does this mean that this entity is still lodging BAS statements and income tax? Is there any way to search another company's lodgement of these?

    I understand that trading names are now obsolete, since 2012. ASIC advises companies change from the trading name to the business name. Is it possible legally to continue to run a business with just a trading name and without ASIC registration?

    We'd like to prove that the debtor was in fact still the legal owner of the business during the dispute period.

    I'd appreciate any help. Thanks.
     
  2. Sophea

    Sophea Guest

    If you wish to trade under a name different from your company name it must be registered with ASIC
     
  3. Scruff

    Scruff Well-Known Member

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    You would need to tell us which web site you're using.

    For the main ABR web site, the "Current" tab simply means you are viewing information that is currently in the database, as opposed to historical information.

    For a business name, "Current" would mean that it is currently registered.

    For an ABN, "Current" would mean that the ABN is still active and hasn't been cancelled. ABN's are cancelled automatically if they are not used for a certain period of time. (I think it's 3 years.) You may have come across an entry in the register at some stage that shows a business name as registered but the ABN as cancelled. This can be seen quite often as a result of business name squatting - similar to what people do with domain names. For example, a person registers a business name and then for whatever reason, they stop trading but want to keep the name for the future. So they keep the name registration current, but after 3 years or whatever, the ABN is automatically cancelled due to inactivity (no tax lodgements etc).

    As for BAS statements and income tax, the above applies here too. Even though you are required to be carrying on a business to be able to register a business name, once it is registered, there is never any guarantee that the business is still active. Therefore you can't rely on business name or ABN registers for that kind of information. While an ABN will be automatically cancelled for inactivity, a business name won't be.

    No. If trading under a name other than your own, then you must register a business name. Trading names are additional names that a business can operate under that do not have to be registered - they're more or less like a brand name. You can not operate a business under a trading name alone.

    Trading names were supposed to be phased out on 31 October 2018, but that has been extended by 5 years to 31 October 2023.
     
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    #3 Scruff, 24 February 2019
    Last edited: 24 February 2019
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