Setting up your business's ABN | SME Chat

A Business Number in Australia is referred to as an Australian Business Number (ABN), and it is a number that is used by the government to identify your company. An ABN, which consists of 11 digits, is a mandatory piece of documentation for any company that has a GST turnover of more than ,000. If a company has annual sales that are lower than this threshold, they are not required to apply for an ABN or register for GST even though they are eligible to do so.

ABNs are essential to have if you intend to engage in any kind of commercial activity, and there are a variety of reasons for this. Not only does the government use this one-of-a-kind 11-digit number to identify your company, but it's also used for things like filing taxes and running general business operations.

Having an ABN enables other businesses to look up your company and verify that it is a legitimate entity. It also assists in preventing other companies from withholding 47% of payments from you in accordance with the pay-as-you-go (PAYG) tax regulations. ABNs are also commonly included on documents such as quotes, invoices, and other business-related paperwork.

Applying for an Australian Business Number (ABN) through the Australian Business Register (ABR) does not cost anything. If you want to apply as a sole trader, a company, a trust, or as a partnership, there are no costs involved if you apply directly to the ABR. Likewise, if you want to apply as a partnership, there are no costs involved.

It is possible that you will be required to pay a fee that covers the cost of your accountant's time in the event that you decide to seek advice from them while completing your ABN application.

After submitting your application, you should, in the vast majority of instances, receive your ABN almost immediately. If, on the other hand, you are given a reference number after submitting your application, this indicates that the ABR needs to review the information contained in your application or that they require additional information from you.

In this scenario, the processing of your application will typically take place within 28 business days, at which point the ABR will get in touch with you for further information if it is required. In the event that your application for an ABN is denied, you will be given a refusal number. In addition, a letter informing you that your application was rejected along with the reasons for the rejection will be sent to you.

There are a variety of factors to consider before deciding to submit an application for an ABN. The following is a list of the most frequently experienced advantages of operating under an ABN:

  • Making it possible for third parties to verify the identity of your company when customers are filling out invoices and placing orders
  • After registering for GST, you will have the ability to make claims for GST credits.
  • Keeping all payments you receive free and clear of PAYG tax.
  • The ability to claim energy results in the accumulation of credits.
  • Possessing the ability to acquire an Australian domain name ( com au) for your business
  • Making sure that you continue to comply with the requirements of the Australian Tax Office
  • Possessing the ability to register a company name with the ABR

Prepared to submit an application for an ABN Proceed through the process by following the steps that are outlined below.

Before you get started on your application, it is important to choose a legal structure for your company that is appropriate for your situation. There are four primary types of business structures in Australia, which are:

: select a business structure Prior to beginning your application, it is essential to select a business structure.

  • Sole trader
  • Partnership
  • Company
  • Trust

If you are unsure as to which business structure would be most beneficial for your company, you may want to seek the advice of a business or tax adviser, or you may choose to conduct your own research in this area.

Before you begin the application process, you should make sure you have all of the information you'll need on hand. This will allow the approval process to go more quickly. The following is a list of important information that you will need for your application:

  • Your tax file number (TFN), as well as the TFNs of any business associates you have (directors, partners, etc.), must be provided.
  • The number assigned to your tax agent registration.
  • This is the number of your professional advisor.
  • Any ABNs that you may have had in the past.
  • Either your Australian company number, also known as an ACN, or your Australian registered body number, also known as an ARBN.
  • When you anticipate beginning any kind of business activity, this is the date from which you are required to have an ABN.
  • The legally recognized name of your company that is printed on all of its official documents.
  • The names, email addresses, and phone numbers of any authorized contacts who might be able to modify or update information on behalf of your company
  • Information on how to get in touch with the company, including its physical address, postal address, telephone number, and email address
  • The kind of commercial endeavor that will ultimately be carried out.
  • Any commercial properties that will be managed by your organization going forward

The next step, which occurs after you have gathered all of the information that is necessary to apply for an ABN, is to start filling in your application. You have the option of doing this yourself through the ABR website, or you can use the services of a tax agent. Either way, the choice is yours. On the ABR website, submitting an application does not cost anything; however, if you choose to have someone assist you in filling out your application, you will be required to pay a tax agent for their services.

If you have completed your application in its entirety and included all of the required details, you should receive your ABN not long after it has been submitted. However, depending on the specifics of your situation, your application might need to be reconsidered or you might be asked to provide some additional information in order to ensure that you comply with all of the pertinent ABN requirements. In the event that your application for an ABN requires an evaluation, it should typically be processed within twenty-eight calendar days.

It is possible that your application will be denied under certain conditions; in such a case, you will receive written notification of the reasons for the denial along with the letter. You have the option of resubmitting your application using this information, along with any necessary changes that you have made.

You are looking for more information and resources to assist you in getting your business off the ground, and you can find them here. Learn more by visiting our blog geared toward small business owners.

The opinions presented are solely those of the person who was interviewed and do not necessarily represent Aon's positions. A great deal of care has been taken by Aon in the production of this document, and the information that is included in it has been derived from sources that Aon considers to be trustworthy. Aon, on the other hand, does not guarantee the correctness of the information that it obtains from third parties, nor does it guarantee that the information is appropriate or suitable for any purpose. The sole purpose of the information presented here is to provide general information. It is not meant to be exhaustive, nor does it, nor should it (under any circumstances) be construed as constituting legal advice. Neither of these things should be taken as meaning that it offers legal advice. Before taking any actions or placing any reliance on any of the information presented here, you should first consult with an impartial attorney or other qualified professional. Aon is not liable for any loss, damage, cost, or expense that you or anyone else may incur as a result of relying on or making use of any information contained in this document.

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