June 11, 2019

Photo by Patrick Perkins on Unsplash🇵🇭

What does ordinarily resides in Australia mean for Australian company registration?

Updated 3 January 2021

When you set up an Australian company, at least one of your company directors needs to reside in Australia.

This is a legal requirement under the Corporations Act 2001 (Cth). 

So here's what you need to know about the rule. 

The Corporations Act 

You’ll need to have at least 1 director that must ordinarily reside in Australia.

Now, you can have an overseas director or multiple directors as well. But, you need to have at least one director that ordinarily resides in Australia. 

Ordinarily resides meaning 

The Corporations Act does not define ordinarily resides unfortunately. 

And, without a definition in the Corporations Act, many look to the residency test set by the Australian Tax Office (ATO). 


First, to understand how tax will apply, and also to get an idea of what resides means generally.  

Here's the ATO's definition of resides in Australia and what the ATO takes into account. 

These are the factors that the ATO takes into account: 

  • your Australian ties - family, work, residence 
  • your intentions shown through your actions e.g. 12 month lease, Australian bank accounts 
  • maintenance and location of your assets
  • social and living arrangements
  • you can be a resident in more than one country.

And here's another good article about setting up a company as an overseas entrepreneur.

Other options

If you are planning on being overseas for some time and you are currently a sole director, you can consider adding on another director that does in fact reside in Australia. 

If you don't have a suitable director that can join, another option is resident director services. This means that you pay a fee for someone that is eligible to be a director to hold this role. 

Do you have questions or comments? Leave them below.

I wish you every success in all your ventures!

About the author 

Vivian Michael

As founder and lawyer at Michael Law Group, CPA and owner of a business consultancy, Vivian is well-positioned to advise Australia's top entrepreneurs. Entrepreneurs benefit from Vivian's commercially focussed legal advice, business experience, and commitment to deliver the best quality business legal services to entrepreneurs.

  • G’day Vivian,
    Thank you for this article! It was exactly what I was looking for. I had tracked down the Corporations Act 2001 and come up empty handed when searching for a definition of ‘ordinarily resides’. I had asked ASIC a very specific question about the definition but they just quoted the sections from the Act.

    We (my wife and I) have an Australian business (IT consultancy) under a trust structure. We are both Australians. We had asked ASIC how long can we holiday (in NZ, we were planning on a year) before we would have to appoint a director that lives in Australia.

    I am satisfied now that we are covered by ‘ordinarily resides’ in our circumstances.

    Thank you again for your article.

    Kind regards

    Rod Anderson

  • {"email":"Email address invalid","url":"Website address invalid","required":"Required field missing"}

    Sign up to our mailing list for useful resources and updates