The Australian business number (ABN) is the identifying number that businesses use when dealing with other businesses. You generally need to quote an ABN on your invoices or other documents relating to sales that you make to other businesses to avoid having an amount withheld from payments made to you. You use your ABN in certain dealings with us and other areas of government.
You are not required to have a tax file number (TFN) to register for an ABN. However, having a TFN reduces the risk of administrative errors when dealing with us.
Income tax exempt organisations do not require a TFN.
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ABN registration is not mandatory. A business can trade without an ABN, but the businesses it deals with are required to withhold (and remit to us) an amount equal to 46.5% of the amount of the payment if an ABN is not quoted.
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An entity receives one ABN, regardless of the number of commercial activities or enterprises it undertakes. However, if the enterprise is carried on by a number of different entity types, each entity needs to register in its own right. This is explained in the following examples.
Example: An entity with several business enterprises
If your entity is currently operating a cafe, a take-away food delivery service and a newsagency from different premises, you will have only one ABN that will cover all of these activities.
Example: Different entity types conducting an enterprise
An enterprise, such as a professional practice, may be conducted by several entities, as follows:
- company A, a corporations law company, is responsible for the day-to-day business operations of the enterprise
- trust B owns the building in which the business operations occur, and
- trust C pays for all business services provided to company A.
Each entity within this structure will need to be registered individually for an ABN. In this case, company A will be registered as it is a corporations law company and trust B and trust C will be registered as they are entities carrying on an enterprise - leasing a building or paying for services for a business activity.
Entitlement to an ABN
To be entitled to an ABN you must be one of the following:
- a company registered under corporations law in Australia
- a government entity
- an entity that is carrying on an enterprise in Australia.
A non-resident entity may be entitled to an ABN where either:
- it is carrying on an enterprise in Australia
- in the course of carrying on an enterprise, it makes supplies that are connected with Australia.
Your enterprise does not have to be located in Australia.
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When applying for an ABN it is important that the information you provide is true and correct.
Making a false or misleading statement to the Australian Business Register (ABR) may result in a penalty. However, if you made a mistake and we consider that you took reasonable care, a penalty will not apply.
The penalty may also be reduced to nil if a voluntary disclosure is made about the statement before being contacted by the ABR.
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How to apply for an ABN
You can apply for an ABN:
- online through the Australian Business Register at abr.gov.au
- through a tax agent, who will lodge your application electronically
- on a paper application
These forms can be used to apply for an ABN only, or both an ABN and a TFN. The superannuation entities form also allows a superannuation fund to comply with certain requirements under the Superannuation Industry (Supervision) Act 1993.
More information
Last Modified: Wednesday, 19 December 2012