What Do I Need to Open a Business Bank Account in Australia?
Written by Bindi Gethen
Opening a business bank account can easily fall to the very end of your to-do list. Endless paperwork. Taxes. Percentages. The entire process can be confusing and, at times, frustrating. Let me guide you.
So what exactly do you need to open a business bank account in Australia? It boils down to five main components: proof of your identity and address, your business name and registered address, a description of the nature of your business, and additional paperwork that may include information on directors, shareholders, and legal authorizations. Keep in mind that each bank also has its specific requirements.
What Do I Need to Open a Business Bank Account?
1. Proof of Identity
First things first, every bank in Australia will require you to provide evidence of your identity when opening a business bank account. This seems straightforward, but it’s more than just pulling out your driver’s licence. Your identity isn’t just your name and face – it’s a set of data points that confirm you are who you say you are.
Each bank may have slightly different requirements, but typically, they require you to provide one primary photographic identification (like a passport or driver’s licence) and one secondary identification (e.g., utility bill, birth certificate, Medicare cards, Tax Office notices, rates from local councils).
If you’re a foreign resident wanting to establish a business in Australia, you’ll likely need a valid international passport, foreign driver’s licence, or national ID card.
Banks are also required to adhere to the Know Your Customer (KYC) regulations, which are designed to prevent banks from being used by criminal elements for money laundering. KYC procedures necessitate that banks verify and maintain records of their customers’ identification.
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2. Proof of Address
It’s not enough to simply know who you are; banks also want to know where you are.
As mentioned, Australian banks will require you to provide documents that show your name and residential address. These can be utility bills, such as electricity or water bills, council rates notices, or even lease agreements. The bank needs to be certain that the place you call home is real and verifiable.
Pro tip
The document you provide must not be more than three months old at the time you present it to the bank.
For non-residents, a document issued by a foreign government, a foreign utility bill, or a statement from a foreign bank can be used. The document must clearly indicate your full name and residential address. Banks may also require your address to be verified by a notary public.
3. Business Name and Registered Address
This is the name under which your business operates and is registered with the Australian Securities and Investments Commission (ASIC). It’s the name that appears on all official documents or legal papers and differentiates your business from others.
Your business’s registered address is equally important. This is the address where ASIC sends your correspondence and where certain legal notices can be served. It needs to be a physical address (not a PO box) where documents can be sent and received during business hours.
The ASIC regularly conducts checks to confirm businesses are operating from their registered addresses. So make sure you have your paperwork ready – even mere typos can be a bane to take care of.
4. Nature of Your Business
Clarify the nature of your business. This step is more than just identifying a category or an industry – it’s the description of what your business does. This information helps the bank understand your business and its specific banking needs.
Banks need to know the type of transactions your business will be conducting, the estimated turnover, and the countries you’ll be doing business with. They’re interested in the people you’ll be paying and who will be paying you. They use this information to assess risk, decide on the services that are most suitable for you, and ensure compliance with industry regulations.
Suppose you’re a local retailer. Your banking needs will significantly differ from an international trading company dealing with multiple currencies.
For this step, you may need to provide a business plan or, at the very least, a detailed description of your business activities. Some banks may also request for financial forecasts or projections, especially for new businesses. If you trade internationally, be prepared to give details of the countries you do business with.
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5. Other Paperwork
Depending on your business structure and individual bank’s policies, there may be other documents or information that you need to provide.
For example, you might have to provide the details of all the directors and shareholders in your company if you’re a proprietary company. If you’re a trust, you’ll likely need to provide your trust deed. Or if you’re a partnership, your partnership agreement may be necessary. Always confirm with your chosen bank.
Banks may also require evidence that the person opening the account has the authority to do so. This could mean providing a copy of a resolution of the board of directors (for a company) or a letter of authority from partners (for a partnership).
Can I Open an Australian Business Bank Account Online?
Yes, you can open an Australian business bank account online, but it’s not as simple as clicking a few buttons. There are regulations to consider, documents to prepare, and criteria to meet.
You can fill out the application forms, upload the necessary documentation, and even chat with banking representatives online. However, take note that while the process begins online, it doesn’t necessarily conclude there. Most banks will require a final in-person meeting to verify the documents and confirm the details provided.
This hybrid approach ensures they maintain their duty of care to their customers and the broader financial system. That visit to the branch is a small price to pay for the convenience the online process provides.
Don’t forget to have both physical and digital copies of your identification documents, proof of address, business registration, and any other necessary documents as per your bank’s requirements.
At The Bookkeeping Studio, We Make Your Business Banking Experience Easy
At The Bookkeeping Studio, we understand that as a business owner, the complexities of setting up a bank account can feel like a distraction from your real work. That’s why we’re committed to making your business banking experience as seamless as possible. We’ll make sure you meet all requirements, save you time, and reduce your stress levels.
In other words, we turn the complex into the simple, the arduous into the effortless. Whether you’re opening your first business bank account or expanding into new ventures, our team of finance professionals is ready to assist you. We’re more than just your bookkeeping service; we’re your partners in business success. Learn how our bookkeeping services make business banking easy.
Hey, my name’s Bindi Gethen! I’m the founder of The Bookkeeping Studio in Australia. With over 15 years of experience in the industry, I have a deep understanding of the challenges that small and medium-sized business owners face when it comes to managing their finances.
I am passionate about empowering my clients with the financial information they need to succeed. My team and I pride ourselves on our commitment to exceptional value, accuracy, and confidentiality. Our virtual bookkeeping services include payroll, budgets, and management reporting, among others.
Not to toot our own horn, but we can assure you that you won’t find a bookkeeping partner like us anywhere else in the Southern Highlands.
