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Willing to settle up or buy a business in Australia as a foreigner? If yes, Australia is one of the easiest developed countries for foreign businessmen. You can easily own 100% of most of the business with zero government approval required for day-to-day business, such as tech, retail or consulting. However, there are some simple rules that you must know and follow carefully to avoid violating the laws and regulations.
Read this blog to explore the crucial aspects of the foreign ownership rules in Australia in 1016, Australia shareholding rules, step-by-step checklists and more. By the end of this blog, you will know how to set up a successful business in Australia.
Yes, foreigners can 100% own a company after business registration in Australia. There is no general prohibition against foreign ownership of an Australian private company (Pty Ltd). A non-resident individual or a foreign entity may hold the position of the sole shareholder and director of an Australian proprietary limited company that is registered with ASIC.
However, foreign ownership becomes regulated when the company acquires substantial Australian assets, businesses, or land above certain monetary thresholds or operates in sensitive or national-interest sectors. In these cases, approval has to be sought from the Financial Investment Review Board (FIRB) prior to the transaction or investment being made.
For most ordinary businesses, such as technology start-ups, consulting, e-commerce, or trading companies, if their valuation is below the relevant FIRB threshold, usually AUD 310 million- AUD1.339 billion in 2025, depending on the home country of the investor, no FIRB approval will be required. In other words, foreign persons can establish or own 100% of the company without government scrutiny.
The following are the crucial Australian Regulators that must be aligned with foreign ownerships:
FIRB advises the Treasurer on foreign investment proposals under the Foreign Acquisitions and Takeovers Act 1975, considering whether an investment that is above monetary thresholds or involved in a sensitive sector could raise national interest concerns and, as appropriate, approve or impose conditions.
The ATO has pursued income tax compliance by foreign-owned companies, applied thin capitalisation rules to limit the debt deductions available, administered withholding taxes on dividends, interest, and royalties, and monitored transfer pricing and controlled foreign company rules to deter tax avoidance.
ASIC registers Australian companies and regulates corporate governance. Foreign-owned companies need to fulfil the ASIC filing obligations, appoint at least one Australian resident director or local agent, and maintain proper records of the company, even if 100% foreign-owned.
Beyond general FIRB rules, there are regulatory agencies such as the ACCC setting foreign ownership limits or security conditions for competition, ACMA for telecommunications, and APRA for banking. The Critical Infrastructure Centre also regulates aviation, media, telecom, banking, shipping, airports, and critical infrastructure sectors.
Australia generally allows 100% foreign shareholding in private companies and most commercial businesses. Restrictions apply only to specific sensitive sectors or when investments trigger FIRB monetary thresholds or national interest tests.
Foreigners can have 100% shares in Australian proprietary limited companies. These operate in technology, software, e-commerce, manufacturing (non-defence), consulting, retail, hospitality, professional services, mining (non-uranium), health care (non-public hospitals), education (private providers), and most commercial real estate developments.
There are no ownership caps for start-ups, trading companies, or service businesses. No FIRB approval is required if the value of the business remains below the relevant country-specific threshold, such as AUD 1.339 billion for investors from the USA, UK, Japan, Korea, NZ, and Singapore in 2025.
Full foreign control without review is also possible in internal restructuring, greenfield investments, and moneylender exemptions. In reality, there are thousands of fully foreign-owned Pty Ltd companies operating successfully throughout Australia.
Certain industries have strict limits irrespective of the value: Qantas-49% maximum foreign total, 35% single foreign airline, domestic airlines-49% aggregate foreign, Telstra legacy-35% foreign, airports-49% foreign, shipping-Coastal Trading Act requires Australian-flagged vessels, media-broadcasting licences limited to 20% foreign, banking-major four banks require Treasurer approval for >15% stakes, aggregated agribusiness land or water entitlements above threshold levels.
Critical infrastructure such as electricity, gas, ports and data centres, together with defence-related businesses, attracts zero-dollar screening. Uranium mining and nuclear facilities are fully restricted to safeguard national security, competition, and public interest.
FIRB approval is required for foreign investments that exceed country-specific monetary thresholds or involve sensitive sectors with zero-dollar triggers. Thresholds include business acquisitions, land purchases, and leases greater than five years in duration. In 2025, most thresholds increased by 2.6% through indexation, relaxing scrutiny of low-value deals below thresholds.
Private investors from FTA partners like the USA, NZ, UK, Singapore, Japan, and Korea have high thresholds: AUD 1,464 million for non-sensitive business acquisitions and developed commercial land. China and Hong Kong also qualify at that level under agreements.
For non-FTA investors, the limits are much lower: AUD 339 million for standard deals and AUD 73 million for sensitive sectors. For entities, the thresholds are cumulative and indexed annually. For foreign government investors, approval is required at AUD 0, regardless of the country of origin.
All foreign investments in sensitive sectors, regardless of value, require approval from the FIRB. These include critical infrastructure (energy, ports, water), defence and military activities, telecommunications, media and broadcasting, data-intensive industries, critical minerals processing, and national security businesses.
A direct interest comprising more than 10% in such an entity will trigger a review. Foreign government investors face an AUD 0 threshold across all sectors. In 2025, reforms increased focus on technology, proximity to government sites, and encryption technologies with a view to protecting national interests.
Agribusiness acquisitions (e.g., farming, forestry, food processing with more than 25% EBIT from such activities) above AUD 73 million for private investors, or AUD 0 for foreign governments, need FIRB approval.
Agricultural land thresholds are not indexed: AUD 15 million cumulative for most foreigners, AUD 50 million for Thailand. Cumulative holdings across Australia will trigger a review if exceeded. An open and transparent sales process must be offered to allow fair competition among bidders for approvals to be granted.
Residential real estate rules tightened in 2025: Foreigners banned from buying established dwellings from April 1, 2025, to March 31, 2027, unless exemptions apply, such as for employee housing. New dwellings, vacant development land, and ‘off the plan’ units require approval with hefty fees.
Commercial real estate thresholds follow the business thresholds: AUD 339 million for non-sensitive developed land, AUD 73 million for sensitive. Leases exceeding five years require review. Build-to-rent projects receive lower commercial fees to enhance housing supply.
Thresholds indexed up 2.6% post-January 1, 2025: Non-sensitive business/commercial land rose to AUD 339 million from 330 million, sensitive/agribusiness to AUD 73 million from 71 million, and FTA high thresholds to AUD 1,464 million.
The residential ban on established dwellings started on April 1. The new FIRB portal launched in March for digital applications. Streamlined processing targets 50% low-risk approvals in 30 days. Exemption for interfund transactions from December 2024 aids funds.
FIRB applications fall into categories like notifiable actions requiring pre-approval, significant actions allowing post-review, and exemptions bypassing scrutiny. Founders must classify investments accurately to avoid penalties. Currently, streamlined processes aim for 50% of low-risk proposals to be processed within 30 days via the new digital portal.
Notifiable actions require prior notification to FIRB and its approval, including the acquisition of more than 20% in an Australian entity above thresholds or direct interests in national security businesses at $0 value.
Significant actions allow the transaction to proceed but can attract the Treasurer’s call-in powers and divestment orders; examples include substantial stakes in sensitive sectors. The exemptions will include greenfield start-ups, interfund transfers from December 2024, and lender securities. All land-related significant actions are notifiable.
Business acquisitions, FIRB approval for foreign stakes exceeding 10% in entities valued above thresholds: AUD 339 million (non-sensitive) and AUD 73 million (sensitive) in 2025, lodge via new portal with fees determined by value, with low-risk proposals targeting decisions within 30 days.
Conditions could include tax compliance and reporting. Non-notifiable notifications result in penalties ranging up to AUD 5.1 million; voluntary notification also guards against call-in for significant actions.
The greenfield exemption enables foreign founders to create new Australian businesses without approval from the FIRB, so long as no pre-existing Australian assets or entities are acquired. This includes startups in non-sensitive industries, such as technology or service-based industries.
However, national security businesses need notification at the $0 threshold. From 2025, the streamlined exemption certificate assists repeat low-risk investors. Solar/wind greenfield projects always require review, unless this is because they’re expanding pre-existing operations.
Interests in commercial land include any lease with more than five years (including options) that would require approval, above the relevant thresholds: AUD 339 million for developed non-sensitive, AUD 73 million sensitive, $0 for vacant or government-leased. To be valued by the total rent over the term, material variations may trigger a new review.
Exemptions apply to renewals of pre-2020 leases below reinstated thresholds. Submissions use the 2025 portal, and bans on residential established dwellings extend to 2027.
Here’s the step-by-step guide to apply for the FIRB approval. Ensure to check out every point carefully:
The standard statutory time frame for FIRB decisions is 30 days from the lodgement of the application. Treasury aims to process 50% of low-risk proposals within this timeframe through the new portal since 1 January 2025.
Applications that are complex or sensitive often take longer. FIRB often seeks voluntary extensions, commonly 90 days, which applicants typically agree to avoid unilateral Treasurer-issued extensions. Reviews in practice take on average 8 to 12 weeks, but take longer for those involving national security because of consultations. During caretaker periods, such as after the call of an election, the processing of major decisions is halted. Low-risk approvals can be made in as little as 2 weeks, although high-risk ones have been known to take in excess of 6 months. You can track the progress online after it has been submitted.
Find the conditions commonly imposed on approvals to ensure you do not face any complications. Look below:
There are no residency barriers to foreigners registering companies with ASIC, but they must observe the corporate laws. The options include Pty Ltd subsidiaries or foreign branches. Obtain ACN or ARBN, appoint a resident director, and secure ABN/TFN. The full process takes a couple of days via online portals, with fees around AUD 500 in 2026.
Pty Ltd grants limited liability as a separate Australian entity, perfect for full market integration and 100% foreign ownership. Subsidiaries, commonly Pty Ltd companies, are controlled by the parent but insulate risks.
Branches continue the foreign parent without the need to create new entities, but expose overseas assets to Australian liabilities; branches must be registered using Form 402 for an ARBN. Pty Ltd would be ideal for long-term growth, while branches are used when testing markets. All must register with ASIC, and subsidiaries must also appoint resident directors. Now, a digital portal will allow easier establishment, but the usual consultation of FIRB thresholds may apply.
Yes, under the Corporations Act 2021, each Pty Ltd should have at least one director residing ordinarily in Australia for local accountability. Foreign founders can appoint non-residents together with them, but single non-resident directors block the registration of a Pty Ltd. For a branch, a Pty Ltd should appoint an agent (individual or firm) for dealing with ASIC/ATO notices.
All directors must get a Director ID from ABRS. The costs for nominee services range from AUD 1,000 to AUD 3,000 per annum. Failure risks de-registration. Now, verify residency via address proof; public companies need two residents.
You will need an ABN, which is an 11-digit identifier, for invoicing, claiming GST credits, or trading as a foreign-owned business. It’s free through ABR upon ASIC registration. TFN is a 9-digit tax identification number required for dealing with income tax, superannuation, and dealings with the ATO when gaining Australian-sourced profits.
Companies receive company TFNs, while individuals receive personal ones. Both are available to register online via myGovID and supported documents. Non-residents, from 2025, may use a certified ID to link an ABN with a TFN to enable the lodgment of a BAS. Without them, such payments shall attract 47% withholding tax.
Overlooking resident director appointments delays registration. Assuming the ABN suffices without ASIC set-up exposes one to fines up to AUD 13,320. Choosing unavailable names creates manual reviews, adding weeks. Neglecting Director ID applications blocks board formation. Failing annual reviews or address updates risks strikes.
Underestimating Branch vs Subsidiary liabilities leads to asset exposure. In 2026, ignoring digital portal mandates causes rejections. Always verify names, appoint agents early, and lodge Form 201/402 correctly to avoid penalties and de-registration.
Foreign ownership attracts ATO scrutiny on tax deductions and repatriation, while the thin capitalisation rules place a limit on the claims for debt interest. Withholding taxes at 10-30% apply to dividends, interests, and royalties. Foreign residents are also subject to CGT on Australian assets with no CGT discount. Transfer pricing and CFC rules prevent the shifting of profits to low-tax countries.
Thin Capitalisation Rules
Withholding tax is imposed on the Australian sourced payments to non-residents: unfranked dividends at 30% (treaty-reduced to 5-15%), franked dividends exempt, interest at 10% (treaty often 0-10%, e.g., no tax for financial institutions), royalties at 30% (treaty 5-15%, e.g., 5% for industrial royalties). Payments withheld and remitted to ATO by the 21st of the next month.
Lodge annual reports by 31 October. Foreign residents declare in their home country, claiming credits. From 2025, stricter penalties for non-remittance up to AUD 5,100. Advise payers of residency for treaty rates; failure triggers a 47% top-up.
Foreign residents face CGT on taxable Australian property, namely real estate and mining rights and indirect interests over 50% of land value, at marginal rates, with no discounting for 50% and no exemption for main residences, unless the life events test is satisfied.
The FRCGW requires a 15% withholding on sales from 1 January 2025, with no threshold of $750,000. Refunds will be obtained via return. From 1 July 2025, this expanded to assets with a land/natural resource nexus, including a 365-day principal asset test for indirect interests. Notify ATO for high-value disposals over AUD 20 million. Excluded are pre-CGT assets, which are those acquired before 1985.
Transfer pricing under Division 815 demands arm’s length conditions for related-party dealings, consistent with OECD guidelines, and applies to the quantum of debt pre-thin cap from 1 July 2023, requires documentation, with penalties up to 100% of adjustments.
From 2025, narrower CbC exemptions, an updated Short Form Local File, and financing risk zones. CFC rules attribute tainted (non-active) income from a controlled foreign company (more than 50% Australian control) in a listed country to Australian residents at marginal rates. Exempts active income, and provides exemptions for low-tax entities. ATO ramps up compliance with public reporting.
Australia applies strict limits on foreign ownership in sectors for national security, competition, and infrastructure concerns. These include aviation (49% limit), banking (Treasurer approval for major stakes), telecommunications (35% aggregate), media (5% FIRB threshold), shipping (majority Australian-owned vessels), and airports/critical infrastructure (49% cap, zero-dollar FIRB review).
Specifically, under the Air Navigation Act 1920 and the Qantas Sale Act 1992, the aggregate foreign ownership in Australian international airlines such as Qantas is limited to 49%, with no foreign airline allowed to own more than 35% and any individual no more than 25%.
General domestic airlines have a 49% foreign limit. These are retained in 2025 on the basis of protecting national carriers. An FIRB approval is required for stakes above the thresholds, though a zero-dollar review applies to defence-related aviation. Low-value greenfield investments also offer exemptions from these prohibitions, allowing foreign entry into non-sensitive general aviation services.
Foreign ownership in banking complies with the Banking Act 1959 and the Financial Sector (Shareholdings) Act 1998, requiring APRA oversight and Treasurer approval for stakes over 15% in major banks like the Big Four. No absolute cap exists, although national interest tests apply through the FIRB. Foreign banks operate as branches or subsidiaries with retail deposit restrictions.
In the current year, 2026, the toughened scrutiny targets financial stability and competition; passive investments below thresholds avoid review, while government-linked entities face zero-dollar thresholds.
The 1991 Telstra Corporation Act restricts aggregate foreign ownership in Telstra to 35 per cent, with individuals capped at 5 per cent. It requires an Australian chair and majority directors. All carriers of telecommunications and carriage service providers must gain FIRB approval for foreign stakes above 10 per cent, with zero-dollar thresholds for national security businesses such as data networks. In 2026, reforms under the Security of Critical Infrastructure Act broaden the scrutiny to encryption and supply chains, banning foreign control of NBN Co until privatisation.
Under the Broadcasting Services Act 1992, foreign interests of at least 2.5% in Australian media companies (TV, radio, newspapers) are required to register with the ACMA. A stake of 5% in broadcasting or publishing businesses is considered sensitive and involves low thresholds, hence approval from FIRB.
There are no direct ownership caps that are especially applicable, but national interest reviews may be invoked to protect diversity and security. In 2026, online platforms qualify for accessing broadcasts, with many exemptions applying for passive stakes below 5%, but government investors will result in full disclosure.
The Shipping Registration Act 1981 requires vessels registered on the national register to have majority Australian ownership (51%), to be eligible for coastal trading. Cabotage rules entitle foreign-flagged ships to deal with 65% of the domestic cargo, but Australian registration gives benefits such as tax breaks.
Port-related investments are subject to FIRB reviews as critical infrastructure from 2025. Exemptions are allowed for chartered vessels by Australian operators, although breaches may result in de-registration. National security is about supply chain resilience.
The Airports Act 1996 limits foreign ownership of airport-operator companies to 49%, with 5% airline limits and cross-ownership bans between major hubs like Sydney and Melbourne.
For critical infrastructure under the Security of Critical Infrastructure Act 2018, ports, energy, and data centres require registration of interests above 10% with Home Affairs and zero-dollar FIRB approval for foreign stakes. The list of expanded reviews in 2025 covers proximity to defence sites among conditions, such as cybersecurity mandates to mitigate risks.
Foreign investors are subject to FIRB approval for land acquisitions above the thresholds, with established residential dwellings banned for 2025-2027. Commercial land is subject to business rules at AUD 339 million for non-sensitive. The states impose 2-5% land tax surcharges on foreign owners, in addition to vacancy fees and registration on the foreign ownership register.
Foreign persons, including temporary residents, cannot acquire established dwellings unless exemptions such as employee housing or significant redevelopment increasing stock apply from April 1, 2025, to March 31, 2027. New dwellings, new off-plan units, and vacant residential land for development are subject to FIRB approval with fees of AUD 14,100 plus vacancy fees that double the fee if the property remains unoccupied.
All acquisitions must be registered on the foreign ownership register. States add surcharges: NSW has 5% stamp duty, VIC 8%, QLD 8% on the purchase, as well as land tax penalties.
Commercial land acquisitions, including offices, factories, and hotels, require FIRB approval above AUD 339 million for non-sensitive developed properties in 2025, indexed upwards by 2.6% (AUD 73 million sensitive). Vacant commercial land is reviewable regardless of value.
Development projects, like build-to-rent, attract concessional fees under commercial tiers from March 2025 to promote housing supply. Leases of more than five years constitute interests; exemptions are available for pre-2020 renewals below the relevant thresholds. Foreign government investors will attract zero-dollar scrutiny across all commercial types of acquisitions.
Surcharges after the High Court ruling in October 2025: NSW-5% on residential land from January 2025, plus 9% duty for purchasers, VIC-2% absentee surcharge on all land, QLD-3% on taxable land. ACT up to 5% on residential, Tasmania-2-5%.
No threshold for surcharge, and limited exemptions to residents or specific trusts. Annual registration is required; failing which, non-compliance attracts 50% penalties. These aim at ensuring better affordability, as in the case of NSW, which enforces audits of foreign declarations stringently in 2025.
Below are penalties and risks of breaching foreign ownership rules. Please look carefully at the pointers given below:
Australia strongly encourages foreign investment and offers 100% ownership in most industries, making it one of the easiest developed markets for international founders. Success lies in making sure you know when to get FIRB approval, set up the right company structure, and follow all applicable tax and sector-specific rules from day one.
With the majority of technology, service, and trading businesses coming in under monetary thresholds, in a few days, you can set up a fully foreign-owned Pty Ltd without government interference. Just remain under thresholds, appoint a resident director, and keep appropriate records for seamless operations. Australia remains a very appealing, stable destination for foreign entrepreneurs with clear rules and processes, plus a new digital FIRB portal.
Seeking guidance for business setup in Australia? At Enterslice, we ease the entire journey of Australia company formation. Connect with our consultants today.
It is forbidden for foreigners to buy established homes, whether they intend to use them as a place of living or as an investment. However, people who are considered “temporary residents” for income tax purposes are only allowed to buy one permanent residence.
Modifications to foreign acquisitions of existing homes. The government declared on February 16, 2025, that it would crack down on land banking and temporarily prohibit foreigners from purchasing established homes for at least two years.
It is still possible for temporary residents to apply for permission to buy new homes or unoccupied property. A new or nearly new home is one of the kinds of residential property that foreigners can purchase in Australia.
Permanent residency cannot be obtained by purchasing real estate alone. Provisional visas leading to possible permanent residency require a minimum investment of AUD$2.5 million.
Limitations on foreign ownership. The limitations imposed on foreign investors' equity ownership in a firm by a government, regulatory body, or the company's charter are taken into consideration by FTSE Russell's index methodology.
If you are not a permanent resident of Australia, you will require clearance from the Foreign Investment Review Board to purchase a home or piece of land.
A property might keep its CGT-free status under the pre-2020 regulations if it was sold within six years of moving out (or forever if it wasn't rented). However, the 6-year rule no longer offers any protection if you were a foreign resident at the time of disposal.
No, due to a temporary prohibition on foreign buyers of existing residences that is in place from April 1, 2025, to March 31, 2027, an Indian citizen cannot now purchase an established home in Australia.
If you are a foreign owner, you are required to pay surcharge land tax on the unimproved land value of every residential property you possess as of midnight on December 31st of each year. The worth of the land itself, without buildings or other additions, is referred to as unimproved value.
Foreign investment takes place when an individual, company, or investment entity (like a superannuation or pension fund) from outside Australia chooses to set up a new business in Australia or acquires property or shares in a business owned by Australians.
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