Every business needs to be registered with the government to function. It’s the best way to legitimise your business while still adhering to the tax and legal regulations. But how do you do that? Through an ABN.
What’s an ABN?
ABN stands for Australian Business Number. It’s an 11-digit number that identifies your business to the government and public. It’s different from your tax file number, which you use to verify yourself during tax season.
Instead, your ABN verifies your business to others when invoicing or receiving payments, claiming GST (goods and services) tax and avoiding PAYG (pay as you go) on payments. If you’re interested in applying for energy grants or getting an Australian (.au) website domain name, both can be done by using your ABN as well.
You must have an ABN to conduct business in Australia.
Applying for an ABN
There are a couple of steps to take to get an ABN. Let’s go through them.
Who needs an ABN?
Not everyone is required to have an ABN. But if you plan to run a business, work as a contractor/freelancer, make supplies connected with Australia’s indirect tax zone, or are a Corporations Act company, an ABN is needed to handle payments, so you must set up one PRIOR to starting business. If unsure, check out the Australian Government page on ABN entitlement here.
Have your TFN first
Before you can apply for an ABN, it’s required to have another number first — your unique 9-digit TFN (Tax File Number). This number is yours for life, and you can keep it even if you switch jobs, move overseas, or change your name. A TFN is used to identify yourself in the tax and superannuation systems. Without it, you can’t apply for government benefits, lodge tax returns, or apply for an ABN.
Therefore, start with getting your TFN and then move on to your ABN. You can apply for your TFN through the government website here. It takes up to 28 days to get approved. Once it is, the government will send your TFN to the postal address on your application. It’s important to disclose this number only to organisations that require it for legal reasons, such as for tax records, for banking, to verify for your university or superannuation fund, as well as government agencies to claim benefits. Apart from those uses, keep it private and stored securely. If it falls into the wrong hands, someone could use it for identity fraud — your name, date of birth, address, and TFN together can be enough, so be careful with who you share it with.
How to apply for an ABN
Once you have a TFN number, you can use it to apply for your ABN. It’s free to register for an ABN through the Australian Government’s Business Registration Service. To apply, you’ll need all your basic identification documents plus your TFN. Once submitted, the ATO aims to review applications within 20 business days. If approved, it will pop up on the ABN Lookup website under your name, and you’ll get a letter in the mail confirming it.
It’s important to keep your ABN easily accessible because you’ll be referring back to it regularly as you run your business. With an approved ABN, you can immediately apply for other business registrations, such as GST. To learn more about the ABN application process, click here.
The importance of a TFN and ABN
Having both your TFN and ABN sorted before starting your business sets you up for success from day one. It ensures you’re operating legally, makes it easier to manage your finances, and gives you the foundation you need to confidently register for things like business accounts, invoices, and taxes. Getting these essentials in place early on saves you time, stress, and potential roadblocks down the track.
Get your ABN to scale your business
Your ABN lets you legitimately start your business. It allows you to get up and running, and from there, start growing and scaling. So why wait? Apply for yours today!
At Melbourne Connect Co-working, we’re passionate about bringing entrepreneurs together to thrive. We’re here to support you every step of the way as you launch and build your business. If you’re curious about getting involved with our co-working community or looking for a place to call home near the Melbourne CBD, contact us here to learn more.