Robin Lamb | Published 9 September 2026 | Updated 15 September 2026
You may already have a reason to consider moving your business from a trust to a company. Perhaps a contract raises questions about the operating entity, a new owner is joining, or the business has changed substantially.
The question is not whether a company is a more advanced structure. It is whether the proposed arrangement addresses the business need, and what consequences come with the change.
Establish what is changing
A trust does not simply become a company.
In a trust structure, the trustee holds and manages property for beneficiaries under the trust arrangement. The trustee may already be a company. That is different from a company carrying on business in its own right.
The proposal therefore needs to be clear about whether business activities and assets would move to a new trading company, and how that company differs from any existing corporate trustee.
Start by establishing who currently holds assets, enters contracts, employs staff and controls the trust. Also identify what would remain in the existing arrangement.
Without that picture, “moving to a company” is too broad a description to assess.
Identify the business reason
Growth, a different mix of activities or plans to introduce an investor can prompt consideration of a company. Licensing, customer contracts, finance and property plans can also shape the discussion.
Describe the specific requirement rather than assuming that growth itself makes a trust unsuitable.
Hypothetical example: A growing business is considering a contract that requires the contracting company to operate in its own right rather than as trustee. That requirement prompts a review of the operating structure. It does not establish that every business asset should move or that the proposed arrangement will satisfy all licensing and finance requirements.
Ask the relevant parties to confirm their requirements before treating a restructure as the answer. Licensing advice belongs with the relevant regulator or appropriately qualified adviser.
Decide who would own and control the company
Company ownership and management are different roles. Shareholders own shares, while directors manage and oversee the company and carry legal responsibilities.
If you are bringing in another owner, discuss their proposed shareholding, voting rights, contribution and involvement in management. Also consider what should happen if an owner leaves.
Do not assume that the people who benefit from the existing trust will automatically hold equivalent interests in the company.
Your accountant and solicitor should consider the proposed ownership together. The tax analysis needs to reflect the commercial agreement, and the legal documents need to reflect the intended rights and responsibilities.
Consider the transition before moving anything
The review needs to cover more than establishing a company.
Transferring business assets can have income tax consequences, including capital gains tax. GST and state duty may also need consideration. The assets involved, their ownership and values, and the proposed transaction all matter.
Small business restructure rollover relief may be relevant in some circumstances. Its availability requires a proper assessment. Even where it applies, it does not remove the need to consider GST, state duty or other legal obligations.
For the accounting review, ask how the proposed change would affect asset values, debts, beneficiary balances and the opening financial position of the company. Clarify which activities and obligations would remain with the trust.
Contracts, licences and financing arrangements need their own review. Ask what approvals or replacement arrangements are required rather than assuming that these will follow the business automatically.
Employee arrangements also deserve attention before changing the employer. Transfer of business rules can affect employment instruments, recognition of service and entitlements.
If property is involved, consider its ownership separately from the trading operation. A move to company trading does not, by itself, answer who should own the business premises.
Your accountant should assess the financial and tax consequences alongside your solicitor’s review of rights, obligations and documentation. Bring the lender and relevant licensing adviser into the discussion where needed.
Understand the ongoing responsibilities
The proposed company needs dependable financial records, tax reporting and administration after the transition.
For a trading company, this includes its company tax return, applicable BAS and employer obligations, and ASIC administration such as the annual review. Directors remain responsible for understanding the company’s financial position even when accounting work is delegated.
Company money is not personal money. Discuss how owners would be paid, how funds would be retained for operations and how transactions with owners would be recorded.
Include any continuing trust administration in the comparison. The question is the cost and responsibility of the whole arrangement, not just the new company.
What to bring to an initial discussion
Useful information includes:
- The trust deed and amendments, trustee details and information about beneficiaries and control.
- Existing company records and proposed ownership details.
- Recent financial statements, current reports and details of loans and beneficiary balances.
- A summary of business activities, significant assets and property.
- Licences, key contracts, leases and finance documents.
- Employee numbers, employment arrangements and recorded entitlements.
- The reason for the move, proposed timing and future ownership or sale plans.
If you are considering this change, speak with Jaha about the accounting and tax questions before making commitments. The aim is to establish whether the proposed arrangement makes sense for your business and what needs further investigation.