A Quick Guide to ABN Registration in Australia

Starting a business in Australia is a big adventure but comes with a fair share of paperwork. Understanding the requirements for business registrations, including obtaining an ABN, is crucial for starting your business correctly. 

One of the first and most important is registering for an Australian Business Number (ABN). This 11-digit number is required to deal with the government, other businesses and the community. In this guide, we’ll take you through the ABN registration process so you have everything you need to get your business up and running.

Why Do I Need an Australian Business Number?

An ABN is more than just a number; it’s a key to your business identity. Here are the main reasons why having an ABN is so important:

  • Identify your business: Your ABN is a unique number that sets you apart from others when ordering supplies, invoicing clients and dealing with the government.
  • Avoid pay-as-you-go (PAYG) tax: Without an ABN, you may be subject to PAYG tax on payments you receive from clients or customers.
  • Claim tax credits: An ABN allows you to claim goods and services tax (GST) credits and energy grant credits, which can reduce your business’s tax liability.
  • Register an Australian domain name: You’ll need an ABN to register an Australian domain name (e.g., .com.au or .net.au).

Who’s Eligible for an ABN?

Not everyone is automatically entitled to an ABN. To be eligible, you must run a business or other enterprise in Australia. The Australian Business Register (ABR) outlines the following criteria for ABN eligibility:

  • Registered companies under the Corporations Act 2001
  • Entities carrying on an enterprise in Australia
  • Entities making supplies connected with Australia’s indirect tax zone
  • Government entities
  • Non-profit sub-entities

If you’re unsure if you meet the eligibility criteria, check the ABR website for more information.

Providing a tax file number (TFN) can expedite the ABN application process and determine your entitlement when setting up a business as a sole trader.

How to Apply for an ABN

Applying for an ABN is a simple process that can be done online through the Australian Government’s Business Registration Service. Before you start, gather the following:

  • Your business structure (sole trader, partnership, company etc.)
  • Proof of identity for all business associates
  • Business activity and key personnel details

If your business is structured as a company, you must obtain an Australian company number (ACN) from ASIC before applying for an ABN.

The information you need to provide will depend on your business structure. Use this table as a guide:

 

Business Structure

Required Information

Sole Trader

Personal details, business activity details

Partnership

Personal details of all partners, partnership agreement

Company

ACN, personal details of directors, company constitution

Trust

Trust deed, details of the trustee


Once you have all the information, complete the online ABN application. You’ll usually receive your ABN immediately if you’ve provided all the required information. However, in some cases, the ATO may need to review your application which can take up to 20 business days. If more information is required, the ATO will contact you directly.

The Australian Taxation Office (ATO) reviews ABN applications and may contact you for additional information to ensure compliance with their requirements.

 

    Keep your ABN Details Up to Date

    Your responsibilities don’t stop once you have your ABN. You must keep your business details up to date with the ABR. Any changes to your business must be notified within 28 days of the change. This includes:

    • Business name
    • Address and contact details
    • Associates and key personnel
    • Business activity

    It is also important to update your business name with the Australian Securities & Investments Commission (ASIC) to ensure continued legal operation.

    You can update your ABN details online through the ABR website. You may need to apply for a new ABN if you change your business structure. Failing to update your business details with the Australian Securities & Investments Commission (ASIC) can result in penalties and legal issues.

     

    How to Cancel your ABN

    You may need to cancel your ABN if:

    • You close your business permanently
    • You change your business structure
    • You no longer operate your business

    Cancelling your ABN is simple and can be done online through the ABR website. Do it as soon as possible to avoid penalties or ATO issues.

    FAQs

    To help you with the ABN application process, here are some frequently asked questions:

    How long does it take to get an ABN? 

    In most cases you’ll receive your ABN immediately if you complete the online application. If the ATO needs to review your application it can take up to 20 business days.

    Do I need an ABN to invoice clients? 

    While an ABN isn’t required to invoice clients, having one helps identify your business and avoids PAYG tax on payments received.

    What happens if I don’t update my ABN details? 

    If you don’t update your ABN details within 28 days of any changes, you can be penalised and have your ABN cancelled.

    Can I transfer my ABN to someone else? 

    No, ABNs are not transferable. If you sell your business, the new owner must apply for their own ABN.

    What is the difference between an ABN and a registered business name? 

    An ABN is a unique identifier for your business, while a registered business name is the name under which your business operates and must be registered with ASIC.

    Key Takeaways

    As you start your business in Australia, remember:

    • An ABN is an 11-digit identifier for your business and is required by the government, clients, and suppliers. You can use the ABN Lookup tool to access publicly available information about registered ABNs.
    • You must be running a business or enterprise in Australia to be eligible for an ABN.
    • Applying for an ABN is free and can be done online through the Business Registration Service. 
    • Keep your ABN details current by notifying any changes within 28 days.
    • Cancel your ABN as soon as you close your business, change structure or cease to operate.

    Disclaimer: This information is general in nature and does not consider your personal circumstances. You should consider the appropriateness of the information with regard to your own objectives, financial situation and needs before acting on it. And, as always, professional advice is recommended.

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