Closing a Company in Australia: How to Shut Down and Retain Key Talent

1. Introduction: Why Companies Close Entities (But Want to Keep Talent)

Mid‑sized Singaporean firms may choose to close a company in Australia for reasons such as cost-cutting, strategic restructuring, or operational pivoting. But that doesn’t mean retaining your Australian talent isn’t valuable. Your local workforce holds institutional knowledge, client relationships, and market insights essential for regional continuity—even without a legal entity.

With an Employer of Record (EOR) Australia solution, you can hire in Australia without entity, enabling you to retain employees without a local entity and ensure smooth employee transfer after entity closure while maintaining compliance and business continuity.

2. What Happens When You Close a Company in Australia

A. Legal & Compliance Requirements

You have two main options:

• Voluntary deregistration (for non-trading, solvent companies) 
• Winding up (liquidation) if liabilities remain

Voluntary Deregistration (ASIC Form 6010):

1. Ensure your company has < AUD 1,000 in assets, no debts, no litigation, and director/shareholder consent
2. Lodge ASIC Form 6010, pay the fee—processed within ~2 weeks; public notice posted
3. If no objections in 2 months, ASIC deregisters the company—assets vest with ASIC

Liquidation: Required if debts or assets exceed the above limits; involves appointing a liquidator and filing audited accounts for distribution to creditors before deregistration can proceed .

Tax and Super Requirements (ATO):

• Finalise all lodgements: PAYG, GST, FBT, and pay all outstanding super guarantee obligations
• After deregistration, ABN, PAYG, and GST registrations are cancelled

B. Timeline & Process Overview

Delays often occur due to unresolved debts, outstanding obligations, or ASIC objections

3. Obligations to Employees

Under the Fair Work Act 2009 and National Employment Standards (NES):

• Notice of termination: Minimum 1 week for <1 year service, scaling up to 4 weeks for >5 years; an extra week for employees over 45 with 2+ years' service
• Redundancy pay (for national system employees):
  • 1–2 years service: 4 weeks
  • 2–3 years: 6 weeks … up to 12 weeks for 10+ years
• Final entitlements: Accrued pay, leave loading, unused leave, etc.
• Consultation: For 15+ redundancies, consult with employees and notify Centrelink; act in good faith
• Genuine redundancy is tax-free up to ATO limits; above that counts as Employment Termination Payment (ETP)

Failing to comply can lead to employee claims, unfair dismissal proceedings, or penalties enforced by the Fair Work Ombudsman.

4. Risks of Talent Loss During Entity Closure

• Operational disruption: Loss of local expertise and client-facing staff 
• IP & relationship risks: Knowledge and networks might vanish with departing employees 
• Re-entry costs: Rebuilding presence later is costly and time-consuming 
• Service continuity: Projects may stall or degrade without a structured transition strategy 

5. Retaining Employees Without a Legal Entity: Your Options

A. Independent Contractors

• Pros: Fast and flexible 
• Cons: Misclassification risk, no employment protections, lower loyalty and continuity 

B. Set Up a New Australian Entity

• Pros: Full legal control 
• Cons: Setup costs, takes months, regulatory overhead (ABN, ACN, directors, office address) 

C. Employer of Record (Best Practice)

An EOR such as AYP becomes the legal employer in Australia. Your staff continue working under compliant contracts with full entitlements. You retain operational control—without the burden of entity management.

With EOR, you can hire in Australia without entity, retain employees without entity, and facilitate employee transfer after entity closure efficiently and lawfully.

Explore AYP’s Employer of Record Australia service.

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6. How EOR Helps You Retain Employees in Australia

What EOR Actually Does

AYP acts as your legal employer of record, handling:

• Employment contracts under fair work norms
• Payroll, PAYG withholding, super contributions
• Notice, redundancy, leave payouts, and compliance with NES
• HR administration and local support services

You keep managing and directing day-to-day operations.

Step-by-Step Transition

1. Planning: Choose key employees to retain 
2. Terminate: Provide proper notice or payout in-lieu 
3. Onboard: AYP rehires these employees immediately under new compliant contracts 
4. Continuity: Seamless roll-over of entitlements—super, leave, seniority 
5. Operate: You continue managing work; AYP handles legal and logistical oversight 

This ensures you hire in Australia without entity, retain employees without entity, and execute employee transfer after entity closure with minimal friction.

Why AYP?

• Quick onboarding: 1 business day
• Legal certainty: Expertise in Fair Work and Australian employment 
• Scalable & ISO-certified across the region

Learn more via our EOR Australia solution.

7. Case Study: Seamless Transition and Full Retention

Company: Singapore-based tech marketing firm

Australian Team: 8 staff

Situation: Strategic exit from Australian operations while preserving client continuity

Solution: AYP EOR engaged prior to redundancy notices

Outcome:

• 100% retention of staff and client projects 
• Compliance: notice, redundancy, Centrelink notifications
• No interruption to campaigns or deliverables
• Voluntary deregistration completed within 6 months

“AYP allowed us to maintain locally embedded talent and customer relationships even after the entity closed.” — Head of APAC Operations

8. Key Considerations Before You Close an Entity

1. Timing
   • Plan EOR transition before issuing notices to avoid legal issues or talent drop-off
2. Compliance
   • Adhere to NES notice periods and redundancy scales
   • Engage in mandated consultations if you’re making 15+ employees redundant
   • Calculate entitlements using Fair Work tools or seek professional support
3. Employee Communication
   • Provide clarity and transparency around the process
   • Highlight continuity of employment, benefits, and roles
   • Structure onboarding in partnership with AYP
4. HR & Payroll Readiness
   • Finalise payroll including leave and redundancy
   • Coordinate super payments and documentation
   • Coordinate handover of records to AYP

9. Conclusion: Close Your Entity Confidently — Keep Your Team

Closing a company in Australia doesn’t need to mean losing your workforce. Through an EOR solution:

• You cut entity upkeep costs
• Preserve team capabilities, client trust, and IP
• Remain fully compliant with labor and tax law
• Stay agile and ready for future opportunities

AYP’s Employer of Record Australia enables you to close a company in Australia while securing your talent and maintaining business continuity.

10. Call to Action: Speak to AYP’s Local Experts

Ready to exit Australia legally—and keep your talent?

✅ Book a free EOR + entity closure consultation

✅ Get a complimentary cost simulation

✅ See how AYP can onboard your team in days—not months

Retain Your Team Without a Local Entity →