ABN: Advantages and obligations
There are a few things you need to know when you apply for an Australian Business Number – ABN
If you are running your own business in Australia, you require a special number called ABN (Australian Business Number). This helps in the easy identification of your business, as well as easy submission for taxes as a business.
If you are providing a service: such as cleaning for a sub-contractor or an agency, in most cases they will ask you for an ABN. This means you are offering your service as a business for someone who is finding the job for you, so you would need to invoice them.
Advantages & Obligations:
- You can also find your own jobs
- Be in control of the amount you charge and invoice that person that you are providing the service for
- Your ABN must be clearly visible on your invoice as well as: your address, contact details, your name and/or your business name if any
- You will be paid a gross sum and you will be responsible for paying the appropriate taxes to the Australian Taxation Office – ATO at the end of each financial year (June 30 of each year)
- You can apply for an ABN only if you have a valid TFN. The ABN is issued by Australian Business Register (ABR) which is a part of ATO
- Remember to register for GST if your annual business turnover is greater than $75000 dollars
- You can employ your own staff and sub-contract other services
- If you employ staff remember to register for PAYG before ATO
- You must open a business bank account to manage your money affairs
- You may need to implement an accounting system to record and produce your own financial statements on a regular basis
- You may need to buy a Public Liability Insurance
This is not an exhaustive list but a guide for your business once you are registered with an ABN number. Refer to your accountant if you have further questions.