ABN number: What it is, who needs one and how to apply for one
Learn how an ABN number helps you invoice, meet tax rules and get paid faster. See how to apply and use it.
Written by Lena Hanna—Trusted CPA Guidance on Accounting and Tax. Read Lena's full bio
Published Friday 5 December 2025
Table of contents
Key takeaways
• Apply for your ABN early in your business setup process since most business activities require one, and the free online application through the Australian Business Register typically takes only 10-15 minutes to complete.
• Register for GST when your annual turnover exceeds $75,000 as a sole trader, or immediately if you operate taxi or ride-share services regardless of turnover, to comply with legal requirements.
• Obtain an ABN to avoid costly tax withholding, as businesses must withhold 47% tax from payments over $75 to suppliers without an ABN, which can create significant cash flow problems.
• Use the ABN Lookup tool on the Australian Business Register website to verify the legitimacy of other businesses you're dealing with by checking their ABN, business name, and GST registration status.
What is an ABN?
An Australian Business Number (ABN) is an 11-digit identifier unique to your business.
You'll use your ABN when dealing with:
- Government agencies like the ATO
- Other businesses as suppliers or customers
- The public for transactions and invoicing
Why do you need an ABN?
ABN registration is legally required for most Australian businesses. You'll also need an ABN to:
- Register a business name with ASIC, which has fees to register starting at $45 for one year.
- Secure a .com.au domain for your website
- Access digital services like eInvoicing
- Avoid tax withholding on business payments
Who needs to apply for an ABN?
Most business owners need an ABN if they're operating in Australia. This includes sole traders, partnerships, companies, and trusts conducting business activities.
You can read more on the Australian Business Register website about who is entitled to get an ABN.
Sole trader ABN requirements depend on your annual turnover:
- Over $75,000 turnover: According to the ATO, you must apply for an ABN and register for GST if your business reaches a GST turnover of $75,000 or more.
- Under $75,000 turnover: Can apply for ABN, register for GST later
- Taxi/ride-share operators: You must register for GST if you provide taxi or limousine travel for passengers, including ride-sourcing, regardless of turnover.
Seek professional advice from an accountant or lawyer before you decide whether to apply for an ABN. Visit the Xero advisor directory if you need help finding someone to provide professional advice.
What are the advantages of having an ABN?
Having an ABN simplifies business operations by establishing your legitimacy with suppliers, customers, and government agencies. Most businesses expect you to provide an ABN for transactions.
Having an ABN also means your business can:
- claim goods and services tax (GST) credits when you are registered for GST
- claim fuel tax or energy grants credits if you qualify
- avoid pay-as-you-go (PAYG) tax on payments you receive
- register a .com.au website domain
- sign up for business accounts with suppliers, for example telecommunications and energy providers
- access business pricing on major purchases such as motor vehicles
- apply for business grants and support payments, and employ staff
- obtain a trademark
- register for eInvoicing
- help you qualify for business grants and support payments
- employ someone
ABNs prevent costly tax withholding on your business income.
Without an ABN, other businesses must withhold tax from payments over $75. The ATO requires them to withhold the top rate of tax, which is 47%, from the payment. While you can claim this back at tax time, it creates cash flow problems for your business.
Apply for your ABN early in your business setup process. Most business activities require an ABN, so getting one upfront prevents delays in operations.
How to apply for an ABN
ABN applications are free and processed through the Australian Business Register (ABR). The online application typically takes 10–15 minutes to complete.
Read our detailed guide on how to apply for your ABN for step-by-step instructions.
What happens after you apply for an ABN?
Once you submit your application, the Australian Business Register reviews it. If your application is successful and all details are correct, you'll receive your 11-digit ABN straight away. In some cases, staff at the Australian Business Register process applications manually, which can take up to 20 business days. You can check the status of your application on the ABR website.
How to check an ABN
You can verify or look up any ABN using the ABN Lookup tool on the Australian Business Register (ABR) website. This is a public register that provides details about a business, including its ABN, business name, and goods and services tax (GST) registration status. It's a good way to confirm the details of businesses you're dealing with.
Managing your ABN alongside your business finances
Once you have your ABN, keeping your business details and financial records in order is simple. With Xero online accounting software, you can add your ABN to your invoice templates and business records. This ensures your ABN is on all your important documents, helping you stay compliant and making tax time easier. Try Xero for free to help you run your business, not just your books.
FAQs on ABNs
Here are answers to common questions small business owners ask about ABNs.
What happens if I operate without an ABN when I need one?
If you're required to have an ABN and don't, other businesses must withhold tax from any payments they make to you at the highest tax rate. It can also make it difficult to deal with government agencies and may affect your eligibility for certain grants or credits.
How long does it take to get an ABN approved?
If you apply online and provide all the required information, you can get your ABN straight away. However, if the Australian Business Register cannot confirm your identity or needs to review your application manually, it can take up to 20 business days.
Can I start using my ABN immediately after applying?
Yes, if your application is approved and you receive your ABN immediately, you can start using it for business purposes right away. This includes putting it on your invoices and other business documents.
What’s the difference between an ABN and an Australian Company Number (ACN)?
An ABN (Australian Business Number) is a unique identifier for all types of businesses, including sole traders and partnerships. An Australian Company Number (ACN) is a unique 9-digit number that the Australian Securities and Investments Commission (ASIC) issues only to registered companies. If you have a company, you'll have an ACN and will also need an ABN to operate.
Disclaimer
Xero does not provide accounting, tax, business or legal advice. This guide has been provided for information purposes only. You should consult your own professional advisors for advice directly relating to your business or before taking action in relation to any of the content provided.
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