For companies in Australia there are a number of legal and tax obligations that must be met, and as your lawyers at Commercial Lawyers Perth will advise you, one of those obligations is to appoint a public officer. If you have never heard the term before or have started a new company and are unsure exactly what a public officer’s role will be, then read on.
The legislation which requires a company to appoint a public officer is the Income Tax Assessment Act. From that you may have already gathered that a public officer is not the official spokesperson of their company, nor do they act in any type of customer service role.
Instead, they are appointed as the person whose responsibility it is to make sure that the company meets its obligations with regard to the Act just mentioned in relation to taxes.
It should be noted that not just anyone can be appointed as a company’s public officer, albeit the legal requirements are fairly broad. They must normally reside in Australia and be at least 18 years of age. They also must be someone who fully understands their obligations and the role which they play as a company’s public officer.
In terms of the work they are required to do, a company should look to appoint someone who has a sound knowledge of finance and tax obligations. This is why it is often an accountant or tax advisor who is appointed to the role. One of the company directors who has tax and accounting knowledge can also be its public officer.
The person appointed to the role of the public officer does not need to be an employee of the company. It is often thought that a company secretary has to be the company’s public officer, but that is not the case. However, someone can take on both roles, if the company asks them to, and they agree.
One important point we must alert you to is the timing of when a company should appoint a public officer as it not something that can be done on a whim, or whenever the company chooses to. A public officer must be appointed within three months of the company starting to trade or ‘be in business’ as it were.
If it fails to inform the Australian Tax Office (ATO) of the appointment within that time, the company can face penalties, and the longer that position exists, the more expensive it becomes.
Daily penalties can be imposed, which means if your company were a month late with its appointment of a public officer the cost could run into thousands of dollars and be increasing each day.
There are certain circumstances in which a company’s public officer can leave their role. This can happen due to a number of reasons as follows:
- Resignation
- Death
- Their own personal bankruptcy
- Being mentally incapacitated
- Moving their residency out of Australia
- Removal due to a company resolution
- Failure to fulfil their duties under the company’s constitution
Whether through their choice, the company’s choice, or through unforeseen circumstances, if a public officer leaves their role, it is not their responsibility to inform the ATO. Instead, the company is obliged to inform the ATO, and they must do so with 28 days. Thereafter, they must appoint a new person to the role of their public officer.
