Do I Need To Get An ABN?

Why You Need To Get An ABN

If you are running a business, it is vital that you register for an Australian Business Number (ABN). This 11 digit number allows you to avoid any taxation problems that may arise if you try to operate a business without one. Whether you are a sole trader, a partnership, or another type of business entity, if you are looking to make a profit from the work that you do, then an ABN is a must.


What happens if I do not register for an ABN?

The ABN system is designed to make it difficult for those who do not have an ABN and attempt to operate a business. If you do not register for an ABN, you could risk the withholding of 47% of the payment amounts made to you by other businesses for your services. This could increase or decrease, depending on the highest rate of tax.


What benefits do I get for registering for an ABN?

Registering for an ABN allows you to access a range of benefits that will make running your business easier. Firstly, you will be able to register for a business name. This allows you to operate under a registered, and unique name for your business.

Secondly, you can register for GST. This has many advantages including allowing you to claim GST tax credits on business operation costs, potentially improving your bottom line.

Finally, you can register for a domain. A domain with is great in creating trust and security between yourself and your customers. It will elevate your brand’s legitimacy and can help your business in appearing in local online search.


What obligations will I have when I register for an ABN?

Once you obtain an ABN, there will be a series of obligations you will be required to fulfil. These obligations are relatively simple and are a normal part of operating a business.

When issuing an invoice, you are required to provide your ABN, address, contact details, name and business name on every invoice. Each piece of information must be clearly visible.

You will become responsible for paying all appropriate taxes to the ATO each year. This will include your own income tax, GST (only if you are registered), and other business taxes you may be obligated to pay.

If your annual turnover reaches $75,000 you will be obligated to register for GST. This can easily be included in your ABN application.

When you begin operating, you will also be obligated to open a business bank account in order to manage your business finances independently from personal finances.


Ride share drivers

Ride share drivers, just like taxi drivers, are required to be registered for GST. This means that you will need to be registered for an ABN in order to operate. Even if you are a driver with Uber, DiDi, Ola, or more, you must be registered for an ABN and GST. You will also need to complete your own tax and lodgement obligations as you are not an employee of these companies.

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