ABN
An 11-digit identifier for businesses, required to invoice, register for GST, and avoid top-rate withholding.
An ABN identifies your business to the ATO, other businesses and government. It is free to apply for and required if you are carrying on an enterprise in Australia.
Without an ABN on your invoice, the business paying you is generally required to withhold tax at the top marginal rate. That alone makes registration essential for anyone invoicing regularly.
Holding an ABN does not make you a business for tax purposes, and it does not make you a contractor rather than an employee. The ATO looks at the substance of the working relationship.
Why the invoice matters
Invoice $5,000 without an ABN and the payer must withhold at the top rate, remitting a large portion to the ATO. You recover it at lodgment, but the cashflow damage is immediate.
The bit people get wrong
Being asked to get an ABN does not make you legitimately self-employed. Sham contracting — treating employees as contractors to avoid super and entitlements — is illegal, and the ABN does not change your true status.
Common questions
Is an ABN the same as an ACN?
No. An ACN is a company number issued when a company is registered. A company has both an ACN and an ABN; a sole trader has only an ABN.
Does having an ABN mean I charge GST?
No. GST registration is separate and generally required once turnover reaches $75,000, or immediately for taxi and ride-share drivers.
Can my ABN be cancelled?
Yes. The ATO cancels ABNs that show no business activity, so keep lodgments current if you want to retain it.