Quick answer
When you move from sole trader to a company, the company has its own ABN and no tax returns of its own, so it can look brand new to a lender. Many low doc lenders will look through to the same business's history under your old ABN if you connect the dots: returns, BAS and statements from the sole trader period, plus the company's ASIC details and a note explaining the change.
Key points
- A company is a separate legal entity with its own ABN and TFN.
- Your sole trader history can still count if you show it's the same business.
- Provide both sets of records: old ABN and new company.
- ASIC's free search shows the company's registration date and details.
Why does incorporating make you look new?
Moving from sole trader to a company is a sensible step for many growing businesses. But it creates a paperwork gap. business.gov.au explains that sole traders use their individual tax file number to lodge returns. A company is a separate legal entity, with its own ABN and tax file number, and it won’t lodge its first return until after its first financial year ends.
So from a lender’s system point of view, the company is new. Its ABN has a recent start date, ASIC shows a recent registration date, and there are no company returns. Your ten years of trading as a sole trader are invisible unless you make them visible.
How do you connect the old history to the new company?
The goal is to show that nothing changed except the legal wrapper. Build a simple continuity pack:
| From the sole trader period | From the new company |
|---|---|
| Last two individual tax returns and notices of assessment | ASIC company details (free basic search shows registration date and ACN) |
| Lodged BAS under the old ABN | BAS lodged under the new ABN so far |
| Bank statements from the old business account | Bank statements from the new company account |
| Invoices to regular customers | Invoices to the same customers, now from the company |
Add a short, signed note: the date of the change, confirmation that the trade, customers and equipment moved across, and the reason (often liability protection or tax advice). If your accountant handled the restructure, a letter from them confirming the same thing carries more weight. See the accountant’s letter.
Where do you find the records?
Your sole trader returns, notices of assessment and activity statements are available through ATO online services linked to myGov. The company’s records are in Online services for business, which needs a myID linked to the company’s ABN in RAM. Our page on ATO online records covers both.
The ASIC register search is free for basic details including the company name, ACN, ABN and registration date. A lender will run this themselves, but having it ready shows you understand what they’ll see.
Illustrative example: fifteen years, three months old
Illustrative only; not a real business.
A tiling contractor traded as a sole trader for fifteen years before incorporating on his accountant’s advice. The company is three months old. He needs $75,000 for a work vehicle and equipment for a larger commercial job.
A bank sees a three-month-old company and asks for two years of company financials. A low doc lender accepts his last two individual returns, BAS under the old ABN, twelve months of old business account statements, three months of company statements showing the same builders paying the company, and a letter from his accountant confirming the restructure. The company borrows, and he provides a personal guarantee as director.
What can weaken the link?
- A change in what the business does. If the new company is in a different trade, the old history counts for less.
- Customers who didn’t move across. Lenders want to see the same income sources continuing.
- A gap in statements around the changeover. Supply the months either side so the transition is visible.
- Tax left behind. If the old ABN has unlodged BAS or tax owing, deal with it; lenders will ask.
Which loan types suit?
- Unsecured, cash-flow and line of credit, typically $5,000 to $500,000, sized on turnover and bank statements. Continuity of statements is key. See bank statement business loans.
- Property-secured, from $20,000 to $5,000,000 by first mortgage, second mortgage or caveat. The structure change matters much less when equity carries the loan.
If you’re unsure which way your evidence points, run the substitute checker and tick “trading history under a previous ABN”.
A short continuity note: what to write
Your note doesn’t need to be formal. Something like this covers what a lender wants to know:
“I traded as a sole trader under ABN [number] from [year] until [date], providing [service] to [type of customers]. On [date] I set up [company name] (ACN [number]) on my accountant’s advice. The company took over the same equipment, customers and phone number, and I am its sole director. My sole trader returns for [years] and the company’s BAS since [quarter] are attached.”
Illustrative wording only. Sign and date it. It turns two unconnected sets of records into one clear story.
What if your accountant restructured into a trust as well?
Some businesses move into a company acting as trustee of a trust, which adds a trust deed and trustee details to the paperwork. The same principle applies: show that the business itself continued. Lenders will also want to see the trust deed and understand who the trustee and beneficiaries are, so have those ready.
Also check that customers are now paying the company, not your old sole trader account. Payments still arriving in the old account months after the change blur the picture and can raise tax questions too.
Bring your history with you
Your business isn’t new just because its structure is. Tell us about the change and what you need. There’s no credit check when you first enquire, your details stay with one team rather than being spread across lenders, and a real person will help you present the continuity properly.
On the form, mention the date you incorporated and how long you traded before. Accurate details help us choose a lender that looks through to your full history. Start here.
Frequently asked questions
Why does my business look new to lenders after incorporating?
Because the company is a separate entity with its own ABN and, until its first year ends, no tax returns. Lender systems see the company's registration date, not your years of trading.
Will lenders accept my sole trader returns?
Many low doc lenders will, provided it's clearly the same business: same trade, same customers, same premises or equipment. A short explanation of the change helps.
Who borrows, me or the company?
Usually the company, with directors providing personal guarantees. The loan must be used for business purposes.
What if I've also changed what the business does?
Then the old history counts for less, because the lender can't assume the income will continue. Contracts or property security become more important.
Can I show the company's statements and my old personal ones together?
Yes. Supplying statements from both the old sole trader account and the new company account, covering the changeover, shows continuity clearly.