When a business doesn't quote its ABN
If a business supplies you with goods or services it should quote its ABN. If it does not you must generally withhold 49% from the payment you make to them and send the withheld amount to us.
You can check an ABN:
You don't have to withhold from payments if any of the following apply:
- the total payment you make to the supplier is $75 or less, excluding goods and services tax (GST)
- the supplier is an individual under 18 years of age and your payments to that person are $350 or less each week
- the goods or services are supplied through an agent who has quoted their ABN on an invoice or some other document relating to the supply
- the goods or services supplied are wholly input taxed under GST
- the entire payment you make is exempt income for the supplier
- the supplier is not entitled to an ABN as they are not carrying on an enterprise in Australia
Also, you should not withhold from the payment if the supplier states in writing that the supply is either of the following:
- made in the course of an activity done as a private recreational pursuit or hobby
- wholly of a private or domestic nature
If you are aware that any one of the above conditions applies, you do not have to withhold. However you must have sufficient records to show the reason for not withholding.
If unsure, ask the supplier to give you a written statement that the supply of goods or services is excluded for one of these reasons. The supplier may use the Statement by a supplier form, or create their own statement containing the same information. You must keep their statement for five years.
If you have reason to believe the statement is false or misleading you must withhold 49% from the total payment.
If a supplier has applied for an ABN you can offer to hold payment until they have obtained and quoted their ABN. This is a matter for you and your supplier to work out. However you must not make full payment to the supplier on the understanding that an ABN will be quoted later.
If you withhold 49% from the payment you must complete a payment summary and give it to the supplier at the same time you pay them the net amount or as soon as practicable thereafter.
If a business supplies you with goods or services, it should quote its ABN to you. If it doesn't, you must generally withhold from the payment you make to them at the top rate of tax.