A statement by a supplier is the ATO form that stops a business withholding 47% from you when you have no ABN to quote. It is not a way around needing an ABN. It exists for the narrow cases where you are genuinely not in business: a private sale, a hobby, or a supply that has nothing to do with an enterprise. Use it for work you are doing as a business and you are making a false declaration.
The problem it solves
When one business pays another for goods or services, the payer has to collect an ABN. If none is quoted, and the payment is more than $75 excluding GST, the payer is required to withhold 47% of it and send that to the ATO instead of to you.
That rule is aimed at businesses operating outside the system. It catches people who are not businesses at all: someone selling a used piece of equipment to a company, a hobbyist whose craft is bought by a shop, a person paid once for something entirely private. Withholding 47% from them would be absurd, so the law provides an exception, and the statement by a supplier is how you claim it.
When can you use a statement by a supplier?
You complete the form and give it to the payer, declaring the reason you are not quoting an ABN. For someone selling something once, or paid for something they do for enjoyment, three of the ATO's reasons do the work. Each is a statement about you or about the kind of supply, not about the job being small or one-off:
- The supply is wholly of a private or domestic nature for you. Selling a personal possession, not trading stock. The ATO's own example is a home owner selling some personal furniture to a second-hand shop.
- The supply is made in the course of a private recreational pursuit or hobby, rather than a business. Holiday craft income, or a stall at a shopping centre car park.
- You are not carrying on an enterprise in Australia, so you are not entitled to an ABN at all.
Where the reason is the first or second of those, the declaration has to be in writing. As a minimum it needs your name and address, why withholding was not necessary, and your signature. The ATO's form is the easiest way to give a payer all three.
The form carries a few further grounds that rarely apply to someone asking this question: payments of $75 or less excluding GST, supplies that are wholly input taxed, an individual or partnership with no reasonable expectation of profit or gain, exempt income such as an endorsed charity's, and young suppliers paid under a weekly limit the form sets out. If you think one of those is you, read the form itself rather than this page.
Notice what is not on the list anywhere: "it was only a small job", "it was a one-off", "I have not got around to registering yet", or "I am about to apply". None of those are reasons. A single job done in the course of running a business is business income, and the exception does not reach it.
When you cannot use it, even if one of those looks close
The ATO also sets out who is shut out of the form entirely. You cannot use it if:
- you are receiving the payment as an employee;
- you are being paid as a company director or office holder;
- the payment is under a labour hire arrangement, or is a specified payment;
- you are being paid as a religious practitioner;
- you are entitled to an ABN for the activity in question.
That last one does the heavy lifting. Entitlement is the test, not registration. If you are carrying on an enterprise you are entitled to an ABN, and being entitled is enough to put the form out of reach, whether or not you have actually applied.
Where the line actually sits
The distinction the form turns on is the same one that separates a hobby from a business, and it is the reason this form is misused so often.
| Situation | Statement, or ABN? |
|---|---|
| Selling your old ute to a company | Statement. A private sale of a personal asset |
| A cafe buys jam you make for fun, once | Statement, if it is genuinely a hobby |
| The same cafe orders jam from you every month | ABN. Repetition, system and an intention to profit make it a business |
| One freelance design job, but you intend to take more | ABN. The intention to carry on the activity is what counts, not the count of invoices |
| You are between jobs and did a fortnight of contract work | ABN. Contracting is an enterprise, however briefly |
If you are unsure which side you are on, the fuller test is set out in our guide on hobby or business. The short version: repetition, an intention to profit, and any degree of organisation all push you towards being in business.
What the payer does with it
The payer keeps the statement with their records for five years and pays you in full, without withholding. They do not send it to the ATO, but they need to be able to produce it if asked, which is why most businesses will not simply take your word over the phone.
They also have to form a view about it. Where a payer has reasonable grounds to believe the statement is false or misleading, they are required to withhold the 47% anyway. The ATO's own example of when it would be unreasonable to rely on a statement is a payer who knows the supplier is operating a business.
So do not be surprised if a larger client declines the form and asks for an ABN instead. That is them managing their own exposure, not being difficult.
If you are reaching for it a second time
The clearest signal that you have crossed into business is needing this form more than once for the same kind of work. A genuine private sale does not recur. A hobby that keeps producing invoices is a business that has not registered yet.
At that point an ABN is both the correct answer and the easier one. It is free to hold, there is no annual fee, and it removes the 47% question from every invoice you send. If the activity later stops, you cancel it.
Common questions
What is a statement by a supplier?
It is an ATO form you give to a business paying you, declaring why you are not quoting an ABN. Where a valid reason applies, it stops the payer withholding 47% of what they owe you.
Can I use it just because the job was a one-off?
No. A single job is not a reason on its own. The exception turns on what the supply was: wholly private or domestic, a hobby or private recreational pursuit, or you genuinely not carrying on an enterprise. One job done in the course of running a business is still business income, however few of them there are.
Does the payer have to withhold from small payments?
No. Where the total payment for the supply is $75 or less, excluding GST, no withholding applies whether or not an ABN is quoted. Above that, the payer withholds 47% unless an ABN is quoted or one of the exceptions applies.
I have applied for an ABN but do not have it yet. Can I use the form?
No. The test is entitlement, not registration. If you are carrying on an enterprise you are entitled to an ABN, and that alone rules the form out. The usual answer is to ask the payer to hold the payment until your ABN issues, which they are allowed to do.
Does using the form mean I do not have to declare the income?
No. The form only addresses whether the payer withholds tax at the time of payment. Whether the money is assessable income is a separate question, decided by what the payment was for.
What happens if I use it when I should not have?
You have given a false declaration to the payer, and the income remains taxable regardless. The practical risk is that platform and payer records are data-matched against your return, so a pattern of payments with no ABN behind them is visible to the ATO.
Is it faster to use the form than to get an ABN?
Rarely. A complete ABN application usually issues the same day, and it solves the problem permanently rather than once per payer. Applying at the Australian Business Register is free if you would rather do it yourself.
Can a business ask me for an ABN instead of accepting the statement?
Yes. The payer carries the risk if they accept a statement that turns out not to apply, so many will simply ask for an ABN. They are entitled to.
Needed it twice? That is a business. $99.
An ABN takes five minutes and ends the 47% question for good. Free help on 1800 546 526.