Opening a business account in Australia from overseas
Whether you’re starting fresh with a business in Australia or expanding your company by establishing an Australian subsidiary, you’ll want to be opening a business bank account.
Australia allows non-residents to open business accounts, although your company must be registered in Australia. Although the process may seem a little complex for foreigners, it’s worth going through the process to open an account as having a business bank account will soon become a primary requirement for many of your business dealings.
There are four different types of business entities that are recognized by Australian law. Those are sole traders, companies, partnerships, and trusts. If your business structure is a company, partnership, or trust, then opening a business bank account in Australia is a requirement.
If you own a foreign corporate entity, you can open a business bank account in Australia provided that your business is registered in Australia. Your business must also hold an ABN/ACN registration number.
Here are some of the requirements when opening a business bank account. Australia has similar requirements as many other countries when it comes to business bank accounts, but there may be more additional details required of you when you are a foreign corporation.
● A company name
You will, first and foremost, be required to provide your company name. Ensure that it is a registered business in Australia.
● Tax File Number (TFN)
Taxable entities will require a tax file number. Your business is likely to be no exception. This number is needed for opening a business bank account Australia.
● Australian Business Number (ABN)
To prove that your business is registered in Australia, you’ll be asked to produce your Australian Business Number. It’s one of the non-negotiable requirements when it comes to opening your business bank account.
As you’ll be selling goods and services, you’ll be required to register for GST before opening a business bank account. Australia has rules and regulations related to taxation that you must comply with.
● Business transaction account (Checking)
A business transaction account is the type of account you’ll use for day-to-day business operations. You’ll be able to withdraw and deposit cash, as well as make electronic transactions. Typically, a monthly fee will be incurred for business transaction accounts.
● Business savings account
If you have surplus cash, then you want to look into a business savings account. You can earn interest from your savings, but you will likely be required to notify your bank provider if you’d like to withdraw from your savings account.
● Business term deposit
While similar to a savings account, what differentiates them is that term deposits have expiry dates and fixed interest rates. Not only that but if you withdraw your deposit before the term expires you’ll be met with a penalty fee.
● Nominate to certify signatories to the account
One person can be nominated to certify signatories. This means that they will be the person responsible for providing all the documents. Any access to the account must be authorized by the nominated person.
● Primary account holders
Primary account holders are people who have the main responsibility and full access to the business bank account. The identity of primary account holders must be verified through the 100-point verification system.
● Nominate people who have access to the bank account & funds
There can be different levels of access to your business bank account. Nominate people who are responsible and trustworthy to have primary access. Primary account holders can then grant additional access at different levels.
You can start the application process online when opening a business bank account. Australia does not have to be your country of residence to do this. You won’t even have to be physically in Australia yet when you start the application process.
However, there are documents required of new customers that must be presented in person when you arrive in the country.
● Proof of ID
This is required for directors of the company, as well as shareholders with more than 25% ownership. The 100-point system is applicable for this, meaning that you’ll have to produce enough of the appropriate documents to meet at least 100 points.
● Certificate of incorporation or business registration
As your business must be registered in Australia, you must be able to provide proof of this in the form of certification. In the case of a trust, documentary evidence of the trust’s creation will also suffice.
● ABN/ACN registered office address
The address listed must match up with the address used for your ABN/ACN.
If you’re opening a business bank account Australia from overseas, you have the option to apply for your account online. Some banks, like the Commonwealth Bank, might even allow you to do your ID verification online to speed up the process. This does not necessarily mean that you don’t have to go to a branch for an in-person consultation, especially as a new customer.
The online process also depends on what banking provider you choose, as not all banks will have an online application process available. Regardless, you’ll likely still have to come to a branch in person to present your documents as a new customer.
After the verification process has been done and dusted, you’ll finally be able to enjoy all the features of your new business bank account. Prior to the document verification, you’ll still be able to access your new account, but there will most likely be limitations, such as an inability to do withdrawals.
Suggested read: How to switch business bank account in Australia
There are several options that you can consider when opening a business bank account. Australia has four big banks with good national coverage.
Here are details of what each one can offer as a business bank account provider.
Business bank accounts with NAB can be free to open, although there are also options that have a monthly fee.
There are a few types of NAB business bank accounts that may suit your needs, starting from a Business Everyday account to a Farm Management account. You can get free cash withdrawals from anywhere within Australia.
As NAB has a large network of ATMs across the country, you’ll have no problems when it comes to cash withdrawals. You’ll have access to 1,500 NAB branches and 3,400 ATMs.
NAB also offers other perks, such as the ability to create specialized bank accounts. With specialized bank accounts, you can have an interest-bearing account.
Commonwealth Bank, or CBA, has the option that allows you to apply for your account online.
However, as per the process of opening a business bank account, Australia will still require you to come in person to a branch with your documents. The Commonwealth Bank regular business account is available in two pricing options with two different plans.
You can have a business bank account with $0 monthly fees, but each of your assisted transactions will incur a $3 fee. At a $10 monthly fee, you can get 20 free assisted transactions per month before the transaction fee is incurred.
With a business bank account with Commonwealth Bank, you’ll gain access to over 1,100 branches worldwide, as well as 4,300 ATMs. Commonwealth Bank ATM cash withdrawals are also free in Australia.
As one of the largest four banks in Australia, ANZ offers several types of business banking accounts. The business transaction account, which you’ll likely use for everyday business operations, comes with a few different plans.
You can open an ANZ business bank account with a monthly fee of $0 with some limitations, such as a limited number of free transactions.
With a monthly fee of $10, you get unlimited transactions for free, with the exception of some transactions like overseas transfers. At a fee of $22/month, you’ll have access to an optional linked overdraft service.
ANZ also offers business savings accounts for any surplus cash you may have, as well as specialist accounts. You can open an ANZ Statutory Trust Account or get a Farm Management Account Deposit if it suits your business needs.
Similar to the other three banks, Westpac also offers different plans for business transaction accounts.
When opening a business bank account Australia with Westpac, you can opt for the $0 monthly fee basic account for unlimited electronic transactions and a $3 fee for every staff-assisted transaction at Westpac branches.
You can also go with the $10 monthly fee account, which gives you 25 free staff-assisted transactions per month. With over 1,400 branches and 3,800 ATMs, Westpac also offers many promotions. You can get free banking as a new customer with Westpac.
Check our article on best business accounts in Australia to know more about the best options available and why Volopay is the best pick out of all the available options.
Before you open a business bank account, it’s a good idea to find out what all the fees and charges that come with it are. Here are the fees commonly associated with a business bank account.
Many bank providers will charge a small monthly fixed fee, often considered as handling charges. The typical monthly fee for business bank accounts in Australia is $10-$22, although you can get accounts with $0 monthly fees so long as you don’t mind some limitations.
Monthly fees may seem minuscule, but when you add them up from month to month you’ll realize that you’re paying a considerable amount. You want to look for banks that can waive the monthly fees for new customers or offer you a reduced rate.
Most banking providers will offer free online transactions when opening a business bank account. Australia typically only charges for assisted transactions such as cash withdrawals and deposits in branches.
The fees for these transactions are likely to be around the $0.50-$3.50 range. You could also have a foreign supplier that you have to pay every month, which will incur international transfer fees.
Oftentimes, transaction fees can be quite a significant markup from the base amount you want to transfer.
While international transaction fees are quite transparent, some banks might have currency exchange markups instead. They may offer low transaction fees but balance it out with high markups.
You can be paying more than the true market rate. Be sure to know your rates before making international transfers.
You’ll be able to withdraw cash from ATMs in Australia with your banking provider for free. However, not only can depositing cash incur a fee but doing withdrawals in foreign ATMs will also likely come with a withdrawal fee.
There are typically no costs associated with opening a business bank account. Australia has four big banks that will allow you to establish a business account for free.
But if you transfer an existing business bank account to the new one you just set up, there might be an establishment fee for the transfer, which could go up to $40.
While internet banking likely will already come with your new business bank package, some banks might not have it included in their plan. Make sure you know if there are any extra internet banking fees.
Other than Australian banks, it is also possible to consider other providers for opening a business bank account. Australia has several other options. Volopay, for one, is an alternative to traditional business banking.
You can apply for Volopay’s business account without having to worry about going to a branch. All the verification and setup processes can be done entirely online.
Once you have your account set up, you can manage all your business expenses and day-to-day operations with Volopay. You’ll also gain access to a multi-currency wallet that enables you to do transfers in foreign currencies at a lower cost.
Both domestic and international payments are easily done through Volopay. Consider signing up with Volopay to meet your business needs in Australia while bypassing the challenges that come with traditional business bank accounts.