What’s in a name, Shakespeare said once in order to highlight the importance of quality. However, your name matters a lot when you are doing business. It not only gives a unique identity to your business but also helps your customers in differentiating it from that of your competitors. In Australia, it is essential for a business owner to not only get his business name registered with the authorities but also get an ABN. An Australian Business Number is a unique 11 digit number that tells others about the legality of your business and helps you in matters related to taxation and licenses. In this article, we shall know about the costs related to getting an ABN and how to apply for it.
How to apply?
You can apply for an ABN online on the website of the Australian Business Register (ABR). Every business owner in Australia needs an ABN to carry on with business activities. Businesses that adopt the structure of a company are also required to get an ACN in addition to ABN. You will be asked to furnish certain details about yourself and your business when you apply for an ABN on Australian Business Register.
Please make sure you have your tax file number, tax agent registration number, and important information about your business ready before applying for an ABN. Keep the details of your business associates and business activities handy when applying.
ABR does not charge a fee for the application of ABN. So, you can relax and breathe easier if you are just starting a business and do not have the cash flow to spend on this identification number. However, if you are applying for ABN through a tax agent, you are required to pay the service fee.
Why is it necessary to apply for ABN?
As mentioned earlier, ABN validates your business in the eyes of your customers and vendors. However, there are more important benefits of ABN for a business owner.
Without ABN, your customers can withhold PAYG tax when making payments. Once you have an ABN, they have to make full payments on your invoices. You can also claim GST credits when filing your income tax returns. There are also energy grants credits that you become eligible for when you have ABN.
Once you have applied for ABN, your application is processed by the authorities based on the information you have provided. ABR issues the ABN if your application is successful and your business gets registered on the Australian Business Register. If your application is unsuccessful, you need to provide clarification on the reasons for refusal highlighted by the ABR.
You can check the status of your application on ABN Lookup. Once you receive ABN, you are entitled to use this unique identification number on your invoices and other stationery used in your business. However, please understand that it is your responsibility as a business owner to update ABN details if there is any change in the nature of the business.