ACN or ABN First?
A lot of confusion exists between ABN and CAN number. The two are different business numbers that Australian Government entities issue to business owners. The CAN stands for Australian Company Number while the ABN stands for Australian Business Number. Some people think that the two stand for the same thing and cannot explain the difference between the two.
The Australian Securities and Investments Commission provides the ACN number to companies registered within the country and issues the ABN to every entity in the country, whether large or small. The CAN provides companies with a unique identifying number, which helps in the monitoring to companies to the large extent. Typically, the ACN consists of nine digits while the ABN comes as an eleven digits number.
You can use the ABN to find more information about your company and verify your details. That helps streamline the communication with various government agencies, which is more beneficial to the business owners. Anyone, the public included, can verify details relating to the company operating within Australia if they have access to the Australian Business Number. You can use the ABN in place of the ACN if it consists of nine digits associated with the ACN. The two numbers have to appear on every document of the company, including receipts, invoices, orders, account statement, notices, orders, written advertisements, and promissory notes.
Not every business with an ACN will require an ABN. The ABN is only important for companies that have an annual turnover of around 75,000 dollars and non-profit organizations with a turnover exceeding 150,000 dollars each year. The ABN is also important for companies that want to benefit from income tax exemption.
How to register for the Australian Business Number (ABN)
Not everyone requires an ABN. To get the number, you should be running an enterprise. By applying for an ABN, the Australian Securities and Investments Commission might decline your application if you are not entitled to it and send you a letter explaining the reasons for the declination.
With an ABN, you will be able to confirm the identity of your business to suppliers and customers when invoicing and ordering. You will also manage to avoid Pay as You Go (PAYG) tax on every payment you receive. Moreover, the number will help you to claim the Goods and Services Tax (GST) credits, energy grants credits and register an Australian domain name.
The registration agency will not charge you any amount when applying for the ABN. They allow people to register for a business name and the business number on the same day. But if you do not want to register for the two on the same day, you will have to return to Business Registration Service to complete the registration of your business name.
After you provide the needed information when applying online, you will be notified of your Australian Business Number immediately after completing the application. If the agency cannot confirm your identity or it requires more information, the Australian Taxation Office will review the application in less than 20 business days. They will contact you if a need for more information arises. If you have changed the structure of your business recently, you might need to change the ABN.