Pty Ltd
A Pty Ltd (Proprietary Limited) company is a private Australian business structure with shareholders and directors. It is one of the most common structures for small-to-medium businesses. Lenders assess the company’s financial statements, revenue, net income, cashflow, and require director guarantees when applying for Business Loans, Working Capital Loans, or Low Doc Asset Finance.
Why Pty Ltd Companies Matter in Lending
A Pty Ltd company is legally separate from its directors and shareholders. However, lenders typically require personal guarantees to ensure accountability and reduce lending risk.
- Stronger legal separation than sole traders or partnerships
- Directors must provide ID, credit history, and guarantees
- Company financial statements are required for most loans
- Preferred structure for scaling and employing staff
- Tax efficiency compared to individual structures
Pty Ltd companies often use invoice finance or a business line of credit to stabilise cashflow during growth phases.
If you’re a director of a Pty Ltd company and want a clearer roadmap for funding decisions, explore our Business Owners Finance Hub for practical examples and strategies.
Common Features of Pty Ltd Companies
- Directors manage daily operations
- Shareholders own shares in the company
- Registered with ASIC and must file annual statements
- Company tax rates apply
- Can act as a Corporate Trustee
Official reference: asic.gov.au