Aug 25, 2021

What is the difference between an ABN and ACN?

Although both an ACN & ABN can be important when starting a business, it is vital to understand the difference between an ABN and an ACN. The main difference between an ABN and an ACN is that an ABN is a business number issued to all entities including sole traders, partnerships and companies by the ATO, while an ACN is specific to companies and is issued by ASIC.

There is often confusion between the two, and it is important to understand that while a company can possess both an ACN & ABN, an individual or partnership will only have an ABN. We’ve broken down the distinction in further detail below to help you wrap your head around those three little letters.

ACN - Australian Company Number: 

An Australian Company Number (ACN) is a unique nine-digit number issued by the Australian Securities and Investments Commission (ASIC) to all companies registered in Australia. 

These unique details allow ASIC to monitor the activities of each company, and identify the information connected to each registration. 

To ensure these details remain active, and your company is registered, ASIC requires all company details to be renewed annually. Thankfully, this is a process EasyCompanies can help with, and we touch base each year to see if we can offer our assistance

ABN - Australian Business Number: 

Unlike an ACN, an Australian Business Number (ABN) can be issued to a variety of different business structures, not just a company. 

An ABN is a unique identifier made up of 11-digits that is issued by the Australian Taxation Office (ATO) to sole traders, partnerships, companies, trusts and other organisations. 

Individuals, partnerships and companies operating using an ABN can also commonly be registered for GST (Goods and Services Tax) and PAYG (pay as you go with withholding), but this is not always required.

An active ABN is also required to register a business name in Australia, regardless of whether or not you are operating as a company, partnership or sole trader. 

Can I apply for both an ACN & ABN?

Yes! If you have registered a company and received an ACN, it is also possible to apply for an ABN

Most registered companies in Australia will actually be required to register for an ABN as well. Australian companies that carry out business activities will be require an ABN. These activities include, but is not limited to:

  • Handling invoices
  • Opening a business bank account
  • Paying employee salaries

Even if you already have an ABN as an individual or sole trader, you will require a new one for your company as it is considered as a separate entity to yourself.

Thankfully, EasyCompanies allows you to apply for an ABN at the same time as registering your company, and this can be selected as an optional extra for just $49! 

What information is needed to apply for an ACN?

When applying for an ACN, you are essentially ‘creating’ a company as a separate legal entity to yourself. As a result, you will need to provide some key information that determines how your company is structured, and its important details. 

In order to register a company in Australia and receive an ACN you need to provide the following information: 

  • A company name
  • A registered office address 
  • Place of business address 
  • Officeholder details
  • Shareholder details 

Through EasyCompanies, once your company registration application has been completed and submitted, you will usually receive an ACN in the next 5 minutes!

How do I apply for a sole trader ABN?

Unlike an ACN, a sole trader ABN is connected to you as an individual. As a result, the information you need to provide primarily relates to your personal details. 

When applying for a sole trader ABN you will have to provide the following information: 

  • Full name details 
  • Date of birth
  • Tax File Number 
  • Business Address 
  • Main Business Activity 

It is also important to note that your business address can be your home address. Similarly, when declaring your main business activity, you will just need to select the option that is closest to your intended activities. There may be no exact match for your business, but just try and choose something that is as close as possible from the options provided! 

How do I make sure my ABN & ACN details remain registered?

An ABN will be active indefinitely - unless you or the ATO choose to cancel those details. Generally, your ABN will only be cancelled if you are not using it, or if the ATO has some concerns surrounding its use. 

Unlike an ABN, your ACN details do need to be renewed yearly. This process is referred to as either an Annual Company Review or an Annual Company Statement, and involves you confirming your company’s details with ASIC & paying a renewal fee. As mentioned before, EasyCompanies offers services to assist you with this renewal process each year. 

What if my ABN has been cancelled? 

If your ABN has been cancelled, you can reactivate it in the same application as applying for a new one. You will not be able to receive a ‘new’ ABN unless your business structure is changing, e.g. if you previously worked as a sole trader and will now be operating in a partnership.

Where the application asks if you have had an ABN previously you would select ‘yes’ and provide your cancelled ABN. 

I’ve lost my ABN & ACN details - where can I find them? 

Luckily, locating your ABN & ACN is a relatively easy process, and can be done online in a few minutes. 

To find your ABN, you will just need to use the Australian Government’s ABN Lookup website. Just include your full name or company details to search for your ABN! 

For your ACN, those details can be located directly through ASIC Connect.

Still unsure about the difference between an ABN and an ACN? Get in touch with our team!

1300 664 337   02 8209 1640
Mon-Fri 9:00am – 5:30pm (AEST)

support@easycompanies.com.au

 

All information provided on this webpage is general information about our products and services. Nothing on this webpage is intended to be professional advice of any kind and should not be relied on as such. You should obtain specific financial, legal or other professional advice before relying on the content of this webpage. By not seeking such advice, you accept the risk that the information on this webpage may not meet the specific needs of your business. Our liability is limited to the maximum extent permitted by applicable law in accordance with our website terms and conditions.

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