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If you’re operating a business in Australia in 2025, you’ll almost certainly need to apply for and obtain an ABN – that unique 11‑digit number which identifies your enterprise. It sets you apart from other businesses and ensures you meet legal and tax obligations. Find out if you meet the eligibility criteria for an ABN below. Remember, securing an ABN is just the beginning of setting up your business for success.
Having an ABN is highly beneficial for your business and the registration process is straightforward. In this updated guide, we’ll walk you through the advantages of holding an ABN, explain how to register for one, and detail the legal obligations that come with it – all with the clarity and friendly advice you’d expect from Sprintlaw. We’re here to help you navigate these requirements confidently in 2025.
Before we dive into the benefits and practicalities, let’s cover the essentials.
What Is An ABN?
An Australian Business Number (ABN) is a unique 11‑digit identifier issued by the Australian Government. It helps differentiate your business from others, making it easier for government agencies, other businesses, and your customers to recognise you. In today’s competitive market, having an ABN is vital for managing your invoicing, tax obligations, and credibility as you grow in 2025.
Do I Need An ABN?
Under Australian law, if you’re carrying on an enterprise or working as a self‐employed contractor, you need an ABN regardless of your turnover. Moreover, if your business earns a GST turnover that exceeds $75,000 in a 12‑month period, you must register for GST – and having an ABN in place is essential for that process. Essentially, if you’re in business, an ABN is a must.
Can Anyone Have An ABN?
If you’re conducting business-like activities – whether as a sole trader, in a partnership, or running a company – you need to have an ABN. Conversely, if you don’t run a business, an ABN isn’t necessary.
For example, if you’re providing services as an independent contractor under a Contractor Agreement, you must apply for an ABN to invoice properly and meet your tax responsibilities.
Can You Have More Than One ABN?
Technically, you can operate multiple businesses under the same ABN if they share the same business structure. However, if each business has a different structure – say one operates as a sole trader while another is set up as a company – then you will need to secure a separate ABN for each structure.
Why Should I Get An ABN?
In 2025, if you’re eligible for an ABN, it’s not only a legal requirement – it’s also a smart business move. An ABN helps avoid potential legal and financial pitfalls and paves the way for several advantageous benefits. Below, we explore the five main benefits of obtaining an ABN:
1. Become Easily Identifiable
When you’re in business, clarity is key. An ABN ensures that your business is uniquely identifiable, reducing the chances of mistaken identity – particularly when dealing with suppliers, clients, and partners. Once you have your ABN, you can also register your business name nationally, which prevents others from using the same or similar names and strengthens your brand’s presence.
2. Avoid Taking A (Temporary) Paycut
Your ABN assures your clients and business partners that you are a legitimate enterprise with proper tax compliance. Without an ABN, businesses paying you may be required to withhold up to 47% of your payment and remit it directly to the Australian Taxation Office – a setback that could temporarily affect your cash flow.
Simply supply your ABN on invoices and all relevant paperwork to ensure you receive full payment, while also enjoying the benefit of a tax‑free threshold of up to $18,200, meaning earnings below this amount are not subject to tax.
3. Tax Credits
Running expenses incurred in the course of operating your business are tax deductible – but only if you have an ABN. By quoting your ABN on purchase invoices, you can claim deductions that reduce your taxable income. Additionally, an ABN allows you to claim GST credits on business purchases, helping you recover some of the costs associated with running your business.
4. Energy Grant Credits
With government initiatives continually evolving, your ABN in 2025 also opens the door to schemes like the Energy Grants Scheme. This initiative rewards businesses for using cleaner, environmentally friendlier fuel options through energy credits – a monetary incentive designed to drive sustainable practices. One of the eligibility requirements for these grants is that your business is registered with an ABN.
5. Australian Domain Name
A modern business needs an online presence, and having an ABN is a prerequisite for registering Australian domain names such as “.au”, “.com.au”, or “.org.au”. These domain endings not only boost the legitimacy of your website but also increase customer trust. In a digital age where competition is fierce, a professional online identity is crucial for success.
In Summary
The key benefits of obtaining an ABN include:
- Easy, unique identification of your business
- Enhanced cash flow by avoiding mandatory payment withholding
- Access to tax deductions and GST credits
- Eligibility for government schemes like Energy Grant Credits
- The ability to secure a professional Australian domain name
These advantages make obtaining an ABN a strategic and essential step for any new business, facilitating growth, compliance, and a strong market presence.
While having an ABN does mean accepting additional administrative obligations, these are standard for anyone running a business. Staying organised and informed about your responsibilities is key – and that’s where expert legal advice comes in handy.
How Do I Get An ABN?
If the benefits outlined above have sparked your interest, here’s how you can secure an ABN in 2025. The registration process remains straightforward and free – as long as you have all your business details and proof of identity prepared.
First, ensure you are eligible for an ABN by confirming that you’re carrying on a business or professional service. Determining this involves looking at factors such as making a profit, advertising your services, and actively seeking clients – for more detailed guidance, check out our guide to starting a business.
Second, decide on your business structure. Whether you choose to operate as a sole trader, a partnership, or a company, your choice will affect your liabilities and tax obligations. For further insights on choosing the right structure, you might also find our article on business structure considerations very useful.
Once you’ve determined your structure and gathered your documents, head over to the Australian Business Registrations Service website and follow the step‑by‑step instructions. In 2025, modern enhancements such as integration with the myGovID app make the process even smoother and more secure.
How Do I Find An ABN?
Need to verify a business’s ABN? Use the comprehensive ABN Lookup tool, which provides up-to-date information on all registered ABNs in Australia. This step is crucial when conducting due diligence and ensuring that you’re engaging with reputable businesses.
What Are My Obligations Under An ABN?
Operating with an ABN means you must meet certain tax obligations. In 2025, this includes lodging an annual tax return and maintaining accurate financial records. Additionally, if you’re making payments to a business that hasn’t provided an ABN, you may be required to withhold a portion of the payment for the ATO.
Keeping abreast of these obligations is essential, as non-compliance can lead to penalties. Regularly reviewing updates from the ATO and utilising resources like our business operations checklist can help you stay on track.
As the business landscape evolves in 2025, many companies are also opting to integrate digital tools to manage their compliance more efficiently. Embracing these solutions not only keeps you compliant but also frees up time to focus on growing your business.
Want The Benefits But Still Unsure About ABNs?
Running a business involves navigating a myriad of decisions and legal considerations. If you’re still on the fence about the benefits of an ABN or need clarity on any legal aspects of your operations, our experienced lawyers are here to help.
Get in touch with our team at 1800 730 617 or email team@sprintlaw.com.au for a free, no-obligation chat – let us help you make informed decisions that set your business up for long-term success in 2025 and beyond.
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