Top dressing is only required for an extra smooth surface. Shave lawn, use a top dressing soil with approximately 80% sand and & 20% soil, no more than 1cm deep, and work the top dressing in until some leaf shows through or cut out an area 20mm deep and replace with a new Lawn.
Avoid soil compaction by using a garden fork to aerate soil once a year (preferably in spring). The best technique is to move the fork in a backwards motion. Drive the fork in vertically and lever it through 30 degrees to lift and rack the ground in 15cm intervals.
In any worn areas dig the area out 40-50mm. Make the area level, lower the prepared area 20mm and replace with a new lawn. Use the extra soil to top dress over the new joins. Water well till established.
Seek expert advice specific to your regional area for any serious pest problems. We have an introduction to pests on our Pests Page