The applicable types of numbers will depend upon various factors (either on their own, or in combination) such as –
• the business structure you choose (e.g. sole trader or incorporated company), and
• the business/trading name your business chooses to trade under (e.g. whether the trading name will be the same as or different from your own name or your incorporated company’s name).
And all these different numbers and the relationships between them can be very confusing. So here is a quick guide to the various commonly issued numbers.
Business Name ('Trading As')
Any person, group of persons (e.g. partners) or company that carries on business in Australia under a business name other than their own name must register the business name.
Up until 28 May 2012 –
• Business (trading names) were registered on a state-by-state/territory-by-territory basis;
• Business name registration was administered by various state and territory based business names’ offices (run by state and territory government organisations/departments with names like ‘Office of Fair Trading’ and ‘Department of Consumer Affairs’);
• Registered business names were allocated Business Name Registration Numbers which generally started with the letters BN, for example BN17284685 (although Victorian Business Name Registration Numbers started with a ‘B’ whilst ACT Business Name Registration Numbers started with an ‘F’); and
• There was no requirement for the registrant of the business name to have a pre-existing Australian Business Number (ABN).
However since 28 May 2012 –
• Business name registration is done on an Australia-wide basis;
• Business name registration is administered by a single national organisation, namely ASIC; newly registered business names are no longer allocated an official separate business name registration number for public purposes (although they do seem to get a supposedly internal ASIC reference number) but instead just ‘go by’ the registrant’s pre-existing ABN (Australian Business Number); and
• In almost all cases, a business name may not be registered unless the entity proposing to trade under the business name has a pre-exiting ABN (or has applied for an ABN and thus has an associated ABN application reference number).
ACN (Australian Company Number – e.g. 091 035 684)
ACNs are 9 digit numbers issued on an Australia-wide basis by the Australian Securities and Investments Commission (ASIC) to Australian incorporated companies once the company registration is completed.
ABN (Australian Business Number - e.g. 92 091 035 684)
ABNs are 11 digit numbers issued on an Australia-wide basis and are recorded on the Australian Business Register (ABR) administered by the Australian Taxation Office (ATO).
The main purpose of an ABN is to serve as a single number allowing businesses to identify themselves reliably in all their dealings with the Australian Government, and particularly with the ATO.
Also, without an ABN quoted on your sales invoices, other businesses may withhold 46.5% of your invoiced sales amount (on account of your business’s PAYG tax obligations). Any person(s) or company carrying on an enterprise in Australia, or making supplies connected with Australia, is entitled to an ABN.
When an Australian incorporated company (having an ACN) applies for an ABN, 2 digits will be added to the front of the company’s 9 digit ACN in order to allocate an 11 digit ABN to the company.
Likewise, when a foreign company (having an ARBN) applies for an ABN, 2 digits will be added to the front of the company’s 9 digit ARBN in order to allocate an 11 digit ABN to the company.
ABNs are not the same thing as BNs or ARBNs.
TFN (Tax File Number - e.g. 785 257 158)
TFNs are issued on an Australia-wide basis by the ATO. If your new business is being run as a partnership, company or trust, your business will need its own TFN (separate/different from your existing personal TFN).
However, if you are running your business yourself as a sole trader, you will continue to use your existing personal TFN. TFNs are not publically available or searchable and generally they should be kept secure and private (but it is normal, for example, for a business to supply its TFN to its bank).
For further information, see this ATO publication: Tax file number and income tax obligations.
GST (Goods and Services Tax) Registration Number (e.g. 92 091 035 684)
These 11 digit numbers are issued on an Australia-wide basis by the ATO to businesses that register for GST.
Generally speaking, businesses with turnover of $75,000 or more must register for GST, and businesses with turnover of less than $75,000 may (but need not) register for GST. A business’s GST Registration Number will generally be the same number as the business’s ABN.
ARBN (Australian Registered Business Number e.g. 124 462 826)
ARBNs are far less common than the other types of numbers referred to above. ARBNs are 9 digit numbers issued on an Australia-wide basis by ASIC to foreign companies carrying on business in Australia (they may also be issued to what are known as ‘Registrable Australian Bodies’ but that is outside the scope of this brief guide)
They are a kind of ‘ACN substitute’ for foreign incorporated companies carrying on business directly in Australia (as opposed to foreign incorporated companies carrying on business indirectly in Australia through owning an Australian incorporated subsidiary company having its own separate ACN).
ARBNs are not the same things as ABNs or BNs.
Some Common Examples
Now let’s take a look at some common small business examples and see what numbers apply.
Example 1: Unincorporated sole trader, trading under a business name other than own name.
John Peter Smith of Sydney is starting up his own full-time local lawn mowing business as an unincorporated sole trader. John proposes to trade under the name ‘Johnny’s Lawn Mowing’.
Because John will be carrying on business in Australia under a business name other than his own name, he will have to register the business name ‘Johnny’s Lawn Mowing’ on the ASIC maintained national Business Names Register.
But because (since 28 May 2012) having an ABN is a pre-requisite to registering a business name (and because John plans to have sales of greater than $75,000 per year, and in any event plans to charge GST to customers and to get an ATO credit for the GST he pays on his business supplies), John will first have to apply for an ABN (and for GST registration), and the ABN he is allocated with (e.g. 92 091 035 684) will also serve as his GST Registration Number.
However John will still use his own existing personal TFN as the TFN of the business, as he and his business are ‘one and the same’.
Example 2: Newly incorporated company trading under its own full name.
Sally, from Victoria, decides to resign from her job as an employee at a recruitment agency, and start up her own recruitment agency by incorporating her own new company called ‘Action Recruitment Pty Ltd’.
ASIC will allocate the new company an ACN (e.g. 099 486 352). And because Action Recruitment Pty Ltd will always use its own full name (including the ‘Pty Ltd’ part of its name) on its letterhead, invoices, signage, website etc., it will not need to separately register a business name.
But because Action Recruitment Pty Ltd is a separate legal entity from Sally, and because it plans to have sales of greater than $75,000 per year, and in any event plans to charge GST to customers, Action Recruitment Pty Ltd will apply for GST registration, and be allocated an ABN (the 11 digit ABN will consist of the 9 digits of the company’s ACN preceded by 2 additional digits e.g. 66 099 486 352). The ABN will also serve as the company’s GST Registration Number.
Action Recruitment Pty Ltd will also apply for and get its own TFN (separate/different from Sally’s existing personal TFN).
Example 3: Sole trader trading under a business name but subsequently choosing to incorporate.
After a few years trading as a sole trader under a registered business name, John (from Example 1 above) decides, ‘to incorporate his business’. So John adds ‘Pty Ltd’ to the end of his existing registered business name ‘Johnny’s Lawn Mowing’ by incorporating a company called ‘Johnny’s Lawn Mowing Pty Ltd’.
The new company will be allocated a 9 digit ACN by ASIC. And because Johnny’s Lawn Mowing Pty Ltd is a new/separate legal entity (separate/distinct from John and his existing business), Johnny’s Lawn Mowing Pty Ltd will apply for and get a new ABN (the new 11 digit ABN will consist of the 9 digits of the company’s ACN preceded by 2 additional digits), a new GST Registration Number (which will be the same as the new ABN), and a new TFN.
John will then wind-up/cancel the old ABN and GST Registration number (but will still keep his existing personal TFN).And because John wants his new company to trade under the existing registered business name ‘Johnny’s Lawn Mowing’ (i.e. he doesn’t want to display the ‘Pty Ltd’ name ending), John will transfer the registration of the existing business name out of his own name and into the name of Johnny’s Lawn Mowing Pty Ltd (by following the procedure set out on this ASIC guidance page: ‘Transfer a business name’).