Small Business
How to set up an ABN for your small business
Here are the steps you need to follow to set up an ABN
Last updated 10 Jun 2021

Here are the steps you need to follow to set up an ABN

An Australian Business Number (ABN) is a unique number that is used by the government to identify your business. Comprised of 11 digits, an ABN is a legal requirement for any business with a  GST turnover of over $75,000. If a business’s revenue is less than this amount, they can still apply for an ABN and register for GST, however, it is not compulsory

 

Why do you need an ABN?

If you plan on conducting any form of business, ABNs are important for a number of different reasons. Not only does the unique 11 digit number help the government to identify your business, but it is also used for tax and general business purposes.

Having an ABN allows others to look up your business and confirm that it is a legitimate entity, while also helping to avoid other businesses withholding 47% of payments under pay-as-you-go (PAYG) tax stipulations. ABNs are also used regularly on quotes, invoices and other business documents.

 

How much does an ABN cost?

It’s free to apply for an ABN through the Australian Business Register (ABR). Whether you’re looking to apply as a sole trader, a company, a trust or as a partnership, there are no costs involved if you apply directly to the ABR.

If you do choose to consult your accountant when completing your ABN application, you may be required to pay a fee that covers the cost of their time.

 

How long does it take to get an ABN?

In most cases, you should receive your ABN immediately after completing your application. If, however, you are provided with a reference number once you submit your application, the ABR may need to review the details in your application or may require more information from you.

If this is the case, your application will typically be processed within 28 business days, with the ABR contacting you for additional information if needed. If your ABN application is not successful, you will be provided with a refusal number. You will also receive a letter that confirms that your application was unsuccessful and the reasons why.

 

What are the advantages of having an ABN?

There are many different reasons why you might choose to apply for an ABN. Some of the most common benefits of working under an ABN include:

  • Allowing others to confirm the identity of your business when completing invoices and orders
  • Being able to claim GST credits once you’ve registered for GST
  • Avoiding PAYG tax on any payments you receive
  • Being able to claim energy grants credits
  • Having the option to secure an Australian domain name (.com.au) for your business
  • Ensuring you remain compliant with the Australian Tax Office
  • Being able to register a business name with the ABR

What are the steps for setting up an ABN?

Ready to apply for an ABN? Follow the steps below to guide you through the process.

 

Decide on a business structure

Before you start your application, it’s important to select a business structurethat is right for you. In Australia, there four main business structures, includingselect a business structure Before you start your application, it’s important to

  • Sole trader
  • Partnership
  • Company
  • Trust

If you’re unsure of which business structure is right for your business, you may want to consult your business or tax adviser, or do your own research.

 

Gather any required information

To help speed up the approval process, it’s a good idea to have all the information you’ll need on hand before you start your application. Some key information that you’ll need for your application includes:

  • Your tax file number (TFN) and the TFNs of any business associates (directors, partners, etc
  • Your tax agent registration number
  • Your professional advisor number
  • Any previous ABNs you may have
  • Your Australian company number (ACN) or your Australian registered body number (ARBN)
  • The date from which your ABN is required (when you expect to commence any business activities)
  • The entity legal name that appears on your business’ official documents
  • The details of any authorised contacts who may be permitted to update or change information on behalf of your business
  • Contact details for the business, including the business’ physical address, postal address, telephone number and email address
  • The type of business activity that will be carried out
  • Any business locations which will be operated by your enterprise

 

Lodge your application

Once you’ve collected all the information required to apply for an ABN, the next step is to start filling in your application. You might choose to do this yourself through the ABR website or you may opt to use the services of a tax agent. It’s free to lodge an application on the ABR website, but you will need to pay a tax agent for their services if you decide to have someone help you fill in your application.

 

Await the outcome of your application

If you have provided all necessary information within your application, you should receive your ABN shortly after submission. In some circumstances, however, your application may need to be reviewed or additional information may need to be supplied to ensure you meet all relevant ABN requirements. If your ABN application does need to be reviewed, it should generally be processed within 28 working days.

In some circumstances, your application may be unsuccessful, but you will be notified by letter of the reasons why your application was refused. Using this information, you may choose to resubmit your application with any required revisions made.

Looking for more information and resources to help you get your business off the ground? Check out our small business blog to learn more.

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The views expressed are those of the interviewee only and do not necessarily reflect those of Aon. Aon has taken care in the production of this document and the information contained in it has been obtained from sources that Aon believes to be reliable. Aon however does not make any representation as to the accuracy of the information received from third parties, nor its suitability of fitness for any purpose. This information is intended to provide general information only. It is not intended to be comprehensive, nor does it, or should it (under any circumstances) be construed as constituting legal advice. You should seek independent legal or other professional advice before acting or relying on any of the content of this information. Aon will not be responsible for any loss, damage, cost or expense you or anyone else incurs in reliance on or use of any information contained in this document.