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  • Our approach to ABNs

    The Australian Business Register (ABR) is a national database where people carrying on or starting a business can register for an Australian Business Number (ABN).

    1. There are around 7.5 million registered ABNs.

    In 2016-17:

    • 855,705 new ABNs were registered and over 90% of online ABN applications were instantly approved.
    • Our integrity program saw cancellation of 810,000 redundant ABNs – almost half due to:
      • non-lodgement of tax returns; or
      • lodged returns showing no business income.
    1. Striking an appropriate balance which safeguards ABN integrity while providing flexibility to ensure existing business continuation and new business creation is paramount.

    Our key focus points are:

    • educating ABN applicants on their entitlement - prior to applying for an ABN - through factsheets and ABN entitlement information on our website;
    • education campaigns targeted at students, job seekers, tax agents and workers in high-risk industries.
    1. The ABR is a key national dataset and it is critical data is accurate, current and reliable.
      • Last year there were over 770 million searches on ABN lookup (the public view of the ABR) by the business community and government agencies to check details of businesses they are dealing with.
      • The register is also used by over 550 government agencies to support businesses and deliver government services (including infrastructure planning, emergency services, pre-filling forms and providing information about grants).
    2. The ATO undertakes a comprehensive integrity program to keep the ABR up to date.

    This includes a review program for:

    • ABN registrants in high-risk industries such as building and construction;
    • ABN holders who are on a student, working holiday or expired visa.
    1. Some businesses incorrectly use ABNs to engage workers as contractors, when they are in fact employees.
      • The law determining whether a relationship is one of contractor or employee has been well established by the courts. If the relationship is one of employee, then there is no entitlement to an ABN.
      • ABN holders can split income through establishing partnerships, trust or company structures. Wage and salary earners do not have this option, which is why it is important we ensure only genuine businesses receive ABNs.
      • We recognise the impact a decision to cancel an ABN could have on an individual. That’s why we involve ABN holders and their contracting partner’s principals – to:
        • provide an opportunity for input into our deliberations;
        • keep them informed; and
        • work together to minimise impacts if ABNs are cancelled.
    2. Where a business has misclassified workers, we work with it to transition those workers to more suitable arrangements.
      • The ATO is agnostic about whether a business adopts an employee or contractor model. Our role is to support businesses to find the right model for their particular circumstances - and operates within the bounds of the law.
      • We acknowledge there may be complex or varied situations to consider across businesses and industries. So an online self-help decision making tool is available, along with extensive information and education for all businesses and workers.
      • Anyone uncertain about how the rules apply is encouraged to contact the ATO (employers on 13 72 26 and workers on 13 28 65) to discuss their situation.
    Last modified: 09 Apr 2018QC 55057