When you start a business in Australia, you’ll often hear about ABN and ACN. But what are they, and why do you need them? Let’s dive into the difference between an ABN and an ACN, and how ISM Accountants & Advisors Pvt. Ltd. can help you navigate this essential part of business registration.
ISM Accountants, recognised as the best accountant Perth, is a leading firm in financial services dedicated to helping new businesses with their bookkeeping and financial management needs. Finding the right accountant in Perth can make a big difference in managing your business efficiently.
Your company can be uniquely identified by its ABN and ACN, which are unique numbers. Nevertheless, the kind of corporate structure you have will determine the number you utilise. This article will explain ABNs and ACNs, their advantages, how to get them, and their potential uses for your company.
Feature Comparison: ABN vs ACN
| Feature | ABN | ACN |
|---|---|---|
| Full Name | Australian Business Number | Australian Company Number |
| Purpose | Identifies a business entity for tax purposes | Uniquely identifies a company registered with the Australian Securities and Investments Commission (ASIC) |
| Applies To | Businesses, including sole traders, partnerships, trusts, and companies | Companies registered with ASIC |
| Issued By | Australian Business Register (ABR) | ASIC |
| Mandatory | Yes, for most businesses | Yes, for companies registered with ASIC |
| Length | 11 digits | 9 digits |
| Example | 12 345 678 901 | 123 456 789 |
What is an ABN?
An ABN (Australian Business Number) is an 11-digit number that uniquely identifies your business to the government and community. It is used for various business activities such as:
- Invoicing and payments
- Claiming GST credits
- Business registrations
What is ABN Lookup?
ABN Lookup is an online tool provided by the Australian Business Register (ABR) that allows you to search for a business’s ABN details. Businesses operating in Australia need to possess their specific ABN which is a unique 11-digit numbering system.
Why is ABN Lookup Important?
ABN Lookup helps in:
✔️ Verifying business identity – Check that you are dealing with a valid organisation.
✔️ Checking GST registration – Check whether a business holds registration for GST.
✔️ Confirming business details – Get information such as business name, status, and entity type.
✔️ Preventing fraud – Avoid scams by checking if a business is legally registered.
How to Use ABN Lookup?
Using ABN Lookup is simple:
- Go to ABN Lookup.
- Enter the business name, ABN, or trading name.
- Click Search to view details.
The results will show key details like the business’s legal name, ABN status (active/inactive), and GST registration.
What is an ACN?
An ACN (Australian Company Number) is a unique 9-digit number issued by the Australian Securities & Investments Commission (ASIC) to all registered companies in Australia. It is used to:
- Identify a company
- Register the company with ASIC
- Assist in managing company records
What is ACN Lookup?
An ACN Lookup allows you to search for details about a company registered in Australia. The exclusive 9-digit ACN differs substantially from the ABN because it provides unique identification for only registered companies under ASIC.
Why is ACN Lookup Important?
ACN Lookup is useful for:
✔️ Checking company legitimacy – Verify if a company is legally registered.
✔️ Getting company details – Find information such as registration date, type, and status.
✔️ Compliance checks – Ensure businesses meet regulatory requirements.
✔️ Reducing business risks – Avoid fraudulent or inactive companies.
How to Use ACN Lookup?
To search for a company using its ACN:
- Visit the ASIC Connect website.
- Enter the ACN, company name, or other details.
- Click Search to access company information.
Can I Have More Than One ABN?
Yes, you can have more than one ABN (Australian Business Number) in Australia, but there are specific conditions and guidelines you must follow. Here’s an overview based on the search results:
Multiple ABNs Under One Business Structure
Theoretically, it is possible to register multiple ABNs linked to a single business structure. For instance, if you operate a company that has both a retail store and a wholesale division, you could apply for separate ABNs for each division. However, this is not common practice and may expose you to operational risks, as liabilities and risks from one business could affect the other if they are not legally separated.
Conditions for Having More Than One ABN
- Same Business Structure: You can only register multiple ABNs if the businesses operate under the same legal structure. If you have different structures (e.g., a sole trader and a company), you must apply for separate ABNs for each structure.
- Multiple Business Names: You can register multiple business names under one ABN, provided they all operate under the same business structure. This can help streamline operations and reduce registration costs.
Registering for an ABN in Australia
Through a licensed tax agency or the Australian Business Register (ABR), you can apply online for an ABN.
- You must first determine your company’s structure and determine whether your enterprise is eligible for an ABN before starting the application process. You can check your eligibility for an ABN by going to the Australian Business Register website.
- For the application, gather data such as tax file numbers, previously held ABNs, ACNs, the legal name of the firm, business contact information, and more.
- Then, to register for an ABN, visit the ABR website’s ABN application portal and follow the instructions.
For example, if you run a small cafe, you would apply for an ABN to legally operate and manage your business finances.
Registering for an ACN in Australia
The ACN registration process is straightforward but involves paying a small fee. This number is essential for legal and financial documentation. Establishing and registering a corporation is the initial step in the more involved process of obtaining an ACN.
Here’s a broad rundown of the procedure:
- Initially, you must determine if starting a business is the best choice for you or if an alternative kind of organisational structure would be preferable.
- Select a company name that is unique and not already in use, then reserve it.
- Choose the operational or governing structure for your business.
- Recognise and fulfill your legal commitments.
- Obtain the signatures of the individuals who will serve as the company’s directors, secretaries, and members.
- Use the Business Registration Service (BRS) provided by the Australian government to register the company.
- Your firm will ultimately be registered upon processing of your application, and you will be issued an ACN.
Updating or Cancelling Your ABN
To cancel your ABN, notify the ABR and they will process your request. It is your responsibility to maintain your ABN information current on the business registry. This contains information on your:
- associates (i.e. directors and shareholders);
- address;
- contact information; and
- GST registration status.
After the modification, you have 28 days to amend these details.
It is your responsibility to notify the Australian Business Register of your desire to cancel your ABN and to ensure that the ABN is shown as “cancelled” on the register.
Updating or Cancelling Your ACN
Changes to your company details must be updated with ASIC. To cancel your ACN, you must deregister your company with ASIC.
Here are the key points about updating or cancelling your ACN (Australian Company Number):
- If your company structure changes, you may need to update or cancel your ACN by informing the Australian Securities and Investments Commission (ASIC). This is separate from updating your ABN.
- To update your ACN details, you can lodge forms with ASIC online or by mail. Common changes include updating your company name, registered office address, principal place of business, or officeholder details.
- To cancel your ACN, you will need to lodge a Form 6010 Notification of ceasing to carry on business in Australia with ASIC if your company has ceased operations or been deregistered.
- Failure to keep your ACN details up-to-date can result in penalties from ASIC. It’s important to notify them of any changes within the required timeframes.
- If your company has been deregistered, you will need to apply for reinstatement of registration with ASIC before you can reactivate your ACN. Fees may apply.
- Updating or cancelling your ABN is a separate process handled by the Australian Business Register (ABR). The ABN and ACN are different identifiers for businesses and companies.
The advantages of having an ABN
Using an ABN has many advantages for your company, some of them are as follows:
- Your ABN can serve as a unique identification for other companies you do business with or want to do business with.
- It makes your company easily recognisable to other companies when processing orders and invoices.
- It enables you to avoid paying pay as you go (PAYG) taxes on the money you get.
- You can obtain goods and services tax (GST) credits if you have an ABN.
- Energy Grant Credits are available to you.
- Obtaining a domain name is possible if you have an ABN.
- Having an ABN makes it simple to identify your company.
- Having an ABN makes it simple to identify your company.
- Because other companies may use a name that is similar to yours but differ in their unique identification number, your company will not be confused with them.
- You won’t experience a little decrease in pay since, in the event that you don’t have an ABN, you might have to deduct 47% of your earnings and provide the ATO this sum.
- If your company has an ABN, you can claim tax deductions for purchases made while the business is in operation.
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The Advantages of having an ACN
The following are some advantages of having an ACN for your company:
- You can lower your risks and personal liability by obtaining an ACN.
- Customers, partners, other companies, and shareholders can obtain company information and recognise your business with ease when you have an ACN.
- Possessing an ACN enables you to comply with the law and certifies that your business has been duly and properly registered with ASIC.
- It indicates that your company has been incorporated.
What is the Australian Retirement Trust ABN Number?
The Australian Retirement Trust ABN is a unique identifier for this superannuation fund. Australian Retirement Trust (ART) is one of the largest super funds in the country, formed from the merger of Sunsuper and QSuper. The ABN for Australian Retirement Trust is 60 905 115 063.
The super fund of Australian Retirement Trust supports members by offering retirement solutions alongside investment opportunities which help members build their retirement savings. Everyone who fits into one of the three work categories of employee, self-employed or business owner has access to contribute money to the Australian Retirement Trust for their financial security after retirement.
If you need to provide the ABN for employer contributions or rollovers, ensure you use the correct Australian Retirement Trust ABN to avoid delays.
Can You Get a Loan on an ABN?
Yes, you can apply for ABN loans if you operate a business or work as a self-employed individual in Australia. Activating an ABN (Australian Business Number) enables you to get special loans for self-employed people which include business financing and vehicle finance together with personal loan options.
Types of ABN Loans:
- Business Loans – Unsecured or secured funding to support business operations.
- Vehicle Loans – Finance options for purchasing a business vehicle.
- Personal Loans – Personal loans from lenders usually extend to ABN holders who demonstrate sufficient income evidence.
To qualify for ABN loans, you typically need:
- An active ABN (registered for at least six months to two years).
- Proof of income (bank statements, tax returns, or BAS statements).
- A good credit score (varies by lender).
The lenders judge your payment capability by analysing your business revenue alongside your financial track record. If you are new to self-employment, alternative lenders may offer loans with flexible eligibility criteria.
How to Get a Car Loan with an ABN?
If you’re self-employed or running a business, you can apply for an ABN car loan to finance a vehicle. Business owners and freelancers and contractors can benefit from this loan because they can obtain vehicles that they need for their work duties.
Steps to Get an ABN Car Loan in Australia:
- Register an ABN – Ensure your ABN is active and linked to a legitimate business.
- Check Your Financials – The evaluation of your financial records including revenue, costs and banking history will be conducted by lenders when you apply for financing.
- Choose a Lender – Businesses with active Australian Business Numbers can select their financing institution from banks along with credit unions alongside lenders with ABN car loan expertise.
- Submit Documents – Business owners should present tax documents with bank records combined with evidence of business operations to the lender.
- Loan Approval & Vehicle Purchase – Once approved, use the funds to buy your car.
Many ABN holders opt for chattel mortgages or hire purchase agreements, which offer tax benefits. GST-registered businesses can also claim tax deductions on the car’s depreciation and interest payments.
Is an ABN and TFN the Same?
No, an ABN (Australian Business Number) and a TFN (Tax File Number) are not the same. The taxation system in Australia requires two unique identifiers because they each fulfill separate functions.
- ABN (Australian Business Number):
- A unique 11-digit number for businesses and sole traders.
- Required for issuing invoices and conducting business.
- Helps with GST registration and claiming tax deductions.
- TFN (Tax File Number):
- A personal identification number for tax purposes.
- Used for employment, tax returns, and government benefits.
- Required by both individuals and businesses for tax reporting.
If you’re self-employed or running a business, you may need both an ABN and a TFN to comply with Australian tax regulations.
Summing Up:
ABNs and ACNs are essential to your company. You’ll be breaking both company and tax rules if you deal without the necessary identifiers. To be legally compliant, it is therefore imperative to understand which number your organisation needs as well as when and how to utilise them.
Whether you’re a sole trader or a large company, having the right identification numbers helps you stay compliant with government regulations. ISM Accountants & Advisors Pvt. Ltd. can assist you with all your business registration needs, ensuring you start on the right foot.
FAQs on ABN vs. ACN: What’s the Difference?
No, an ABN identifies a business, while an ACN identifies a company. They serve different purposes.
Yes, you need an ABN to run any business in Australia. If you operate as a company, you will also need an ACN. Both numbers are crucial for legal and operational purposes.
Yes, applying for an ABN is free.
No, an ABN is a business identifier, while GST (Goods and Services Tax) is a tax you collect on behalf of the government.
Yes, all businesses operating in Australia need an ABN.
Yes, non-Australian residents can apply for an ABN if they meet certain criteria.
Operating a business without an ABN can result in penalties, including fines and difficulty in claiming GST credits. It’s essential to apply for an ABN if you are starting a business in Australia.
