• Your client's ABN entitlement

    When applying for an Australian business number (ABN) online you will be asked to provide details about your client’s situation, activities and business structure. The answers you provide will help determine if they are entitled to an ABN.

    Although everybody can apply, only those who are entitled will get and hold an ABN. If your client is not entitled but you still apply on their behalf, the ABN application will be refused.

    Attention

    Apprentices, trade assistants, labourers and other types of employees are not entitled to an ABN. Find out how the Australian Taxation Office (ATO) distinguishes between an employee and a contractorExternal Link for tax purposes.

    End of attention

    Companies incorporated under the Corporations Act 2001 (Cth) in Australia are entitled to an ABN.

    Other businesses and organisations including individuals/sole traders, charities and super funds must meet requirements to be entitled to an ABN.

    An important requirement for most entities is that they must be carrying on an enterprise.

    Further information

    If your client's business or organisation is located outside of Australia but is carrying on an enterprise or making supplies connected with the indirect tax zone they may be entitled to an ABN.

    End of further information

    What carrying on an enterprise means

    An enterprise includes activities done in the form of a business. The following indicators can help you understand if your client's activities are done in the form of a business:

    • is a significant commercial activity
    • there is an intention to make a profit from the activity
    • the activity isn’t a hobby
    • repetition of the activity
    • commercial sales of products
    • a business plan exists
    • the activities are organised and carried on in a businesslike manner and records are kept
    • the activities are of a reasonable size and scale
    • the entity has relevant knowledge or skill.
    Attention

    If your client gets an ABN they must continue to meet the entitlement requirements. If their business situation changes they may no longer be entitled.

    End of attention

    Read the ATO’s Miscellaneous Taxation Ruling MT 2006/1External Link for specific information for your client’s business structure and examples of entitlement.

    Further information

    If you think your client’s business or organisation is entitled go to Apply for an ABN.

    End of further information

    Defining the term 'Indirect tax zone'

    ‘Indirect tax zone’ means Australia but does not include the external territories and certain offshore areas. The goods and services tax (GST), the wine equalisation tax (WET) and the luxury car tax (LCT) operate in the indirect tax zone. The GST, WET and LCT do not operate in Australian external territories and in certain offshore areas.

    Further information about this term can be found in GSTR 2000/31 Goods and services tax: supplies connected with Australia and GSTR 2006/9 Goods and services tax: supplies.

    • Last modified: 09 Jan 2017QC 333