An ABN vs ACN
An ABN is a unique identifier for your business. Both numbers are used by the Australian Taxation Office to register and pay tax.
Dr. Robert Goddard
•
Updated
June 26, 2022
An ABN is a 9-digit number that identifies your business entities for all goods and services tax purposes with the ATO. It is sometimes referred to as an Australian Business Number or Tax Identification Number. You will use this number when you lodge your income tax return, apply for government grants, or are involved in any business activities including with other businesses. An ABN is required if you are registered for GST purposes with the ATO, however, it is not necessary to have an ABN if you are not trading commercially or if you are a sole trader business structure.
To register for an ABN you need to complete a business registration service application form and provide the below.
Your full name and address.
The date you intend your online services to commence trading.
Details of your proposed business activity.
Any other relevant information requested on the application form, including tax agent registration number details of any previous or related names used by the applicant or director(s).
What is the difference between an ABN and ACN?
An ACN of an Australian company is the same as a business owner number. The business address is used by all federal government departments, the Australian Tax Office (ATO), Australian Securities and Investments Commission (ASIC) and other separate legal entities to conduct business with registered companies.
You are required to quote your ACN on all correspondence with the ATO. It is mandatory for you to include it on any tax returns, forms or schedules you prepare in relation to your business dealings with the ATO or ASIC. You can obtain an ACN by registering online through myGov.
Should I use an ABN or an ACN?
It is advisable to use the ACN as it eliminates the need for you to include your sole traders business number on any forms or documents sent to the ATO. For example, if you are lodging an Australian Business Activity Statement (ABAS), there is no requirement to state your business number on this form; however, if your Australian registered body number was not quoted, it will delay the processing of your tax registrations.
Why would I need an ABN or ACN?
All businesses need to apply for an ABN for the below.
Conduct business with other organisations.
Claim income tax concessions and pay entitlements such as Australian Payroll Tax, GST and Fringe Benefits Tax (FBT).
Make certain claims for input credits on the Business Activity Statement (BAS) and lodge a BAS including PAYG instalment activity statement.
If you are selling goods or services to consumers or another business, you will have to register for the Goods & Services Tax (GST). In addition to registering for GST, your business is also required to hold an ABN. This is essential if your business is registered for GST.
What is the ABN and who needs It?
The ABN (Australian Business Number) is a unique identifier for your business and is your small business identification number with the ATO. It's also known as a tax file number or TFN and it makes it easy to do business by cutting down on paperwork and allowing us to communicate directly – that means less waiting around, more getting on with your own business.
You can apply by phone, using an ABN details lookup service (telephone), online through myGov, post or in person at any Australian Business Register Centre. If in doubt, best to see an accountant.
What is a Tax File Number?
A Tax File Number (TFN) is a unique identifier assigned to you by the Australian Tax Office. It's also known as a tax file number or TFN and serves two purposes: it ensures you have a way to pay your income taxes, and can protect your personal information from identity theft.
If you're an individual earning money from employment or running a business, or receiving benefits from Centrelink, Medicare or the Veterans' Affairs Department, you need to apply for a TFN. Your TFN is compulsory if you want to open bank accounts, start up a business operating in Australia , buy shares/mutual funds, purchase real estate property in Australia and get married and register the marriage.
What is the difference between an ABN and a TFN?
An ABN is to do with your business while a TFN is for an individual. You can get an ABN if you run a business, and you get a TFN from the Australian Taxation Office (ATO). Both numbers are used to pay tax.
How to apply:
Online: my.gov.au
By phone: 13 28 61
In person: go into any Australia Post shop or visit the ATO website for more details
By post: complete an application form and send by mail to the ATO
How long does it take to get an ABN?
The process can take up to seven days once you've submitted your application, however, this time may vary depending on the quality of your application and the particular business structure. An accountant may know the best way to speed things up.
How long does it take to get a Tax File Number (TFN)?
It takes about two weeks after submitting your TFN claim form for the ATO to send it back to you. Once you receive your TFN, be sure to keep it somewhere safe as you will need it if you want to lodge a tax return or apply for benefits like Austudy or Newstart.
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