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If your business has a 'trading name' and the goodwill of your business is associated with it - IT WILL DISAPPEAR FROM 31st OCTOBER 2023
If you are a business owner in Australia, it's important to understand the concept of a trading name and its relationship to your business.
A trading name, also known as a "fictitious name" or "assumed name," is an unregistered name that a business can use to conduct its operations. Before the introduction of the National Business Names Register in 2012, businesses in Australia could use a trading name without having to register it. However, this has changed with the introduction of the Business Names Registration Act 2011.
Check out the differences between Business Names, Trading Names, Company Names, Brand Names and Franchise Names according to ASIC HERE.
Under the new rules, if you wish to continue using a trading name, you must register it as a business name. This ensures that your business name is unique and protects you from any potential legal issues that might arise from using a name that is already in use by another business.
The Australian Business Register (ABR) and ABN Lookup still display unregistered trading names, but these will be removed from 31st October 2023. From this point on, only registered business names will be displayed on these platforms. Visit the ABR site HERE.
To allow businesses affected by the removal of trading names sufficient time to inform their customers, suppliers, and other stakeholders of any changes to the name they use to conduct their business, a transition period has been put in place. This period runs from 28 May 2012 to 31 October 2023.
It's important to note that a trading name is not the same as a registered business name. A registered business name is a name that has been registered with the Australian Securities and Investments Commission (ASIC) and is legally recognized as the name of your business. A trading name, on the other hand, is simply a name that you use to conduct your business but is not registered with ASIC.
If you are a business owner in Australia and you are using a trading name, it's important to take the necessary steps to register it as a business name before the transition period ends. This will ensure that your business name is legally recognized and that you are protected from any potential legal issues that might arise from using an unregistered name. You are also protecting the goodwill in your business.
As a business owner, what should you do?
- Check what business or trading names are currently attached to your ABN. This is very simple to do. Go to ABN Lookup and put your ABN in the search box. It will then display your business details and list any business or trading names associated with that ABN.
- Decide what 'trading name(s)' you want to keep.
- Now register your 'trading name' as a 'business name' and the best place to start is Register Business Name
REMEMBER: To continue using a trading name after October 2023, you have to register it as a business name.
In Business Owners Taking Action groups (BOTA) we keep members focused on growing their businesses and working towards having a business that is a valuable and saleable entity. A business that's ready for sale is well worth keeping!
Want to know how saleable your business is? If you wanted to sell now or were forced to exit / sell now - could you? Take the quick saleability quiz below and a get a personalised report and tips within minutes.
More information on Business Owners Taking Action AVAILABLE HERE.
