What is the Difference Between an ABN and ACN?

Summary

• An Australian Business Number (ABN) is an 11-digit identifier for tax and business purposes, whilst an Australian Company Number (ACN) is a 9-digit identifier specifically for registered companies.
• All companies automatically receive an ACN upon registration with ASIC, but an ABN must be separately applied for through the Australian Business Register.
• Sole traders and partnerships can obtain an ABN but cannot have an ACN, as ACNs are exclusively for companies registered under the Corporations Act 2001.
• This article explains the differences between ABNs and ACNs for business owners in Australia.
• LegalVision is a commercial law firm that specialises in advising clients on business registration and compliance matters.

Tips for Businesses

Apply for an ABN if you operate any business structure and earn over $75,000 annually or want to claim GST credits. Register a company with ASIC to receive an ACN if you need limited liability protection. Display your ABN on invoices and business documents to enable tax compliance.

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On this page

• What is an ABN?
• What is an ACN?
• How Do I Find an ABN or ACN?
• How Do I Register an ABN?
• Updating or Cancelling Your ABN
• How Do I Register an ACN?
• Key Takeaways
• Frequently Asked Questions

An Australian Business Number (ABN) is an eleven-digit identifier that all businesses must obtain to conduct commercial transactions and deal with the Australian Taxation Office. In contrast, an Australian Company Number (ACN) is a nine-digit number issued exclusively to companies by the Australian Securities and Investments Commission.

While these numbers serve similar identification purposes, they apply to different business structures and have distinct registration processes. Some business owners will require both an ABN and ACN, depending on how they operate. This article will explain the difference between an ABN and ACN, help you determine which one to register for, and outline the registration process for both.

What is an ABN?

An ABN is an eleven-digit number that all businesses must obtain. It identifies the business and is used in commercial transactions and dealings with the Australian Taxation Office (ATO). As business names can be quite similar, a company’s ABN helps people ensure they are dealing with the correct entity. Your ABN is unique and therefore avoids confusion for consumers and businesses alike. Additionally, an ABN is issued to all businesses, irrespective of their size or structure (e.g. sole trader, trust or company).

It is important to keep your ABN information up to date via the Australian Business Register website, and to complete your BAS (Business Activity Statement) lodgments if you meet the requirements.

What is an ACN?

An ACN is a nine-digit number that only companies receive. As discussed above, the ATO issues ABNs. Meanwhile, the Australian Securities and Investments Commission (ASIC) issues ACNs. An ACN is similar to an ABN because it is also a unique number that identifies your company. ASIC uses the ACN to monitor companies. Additionally, like ABNs, ASIC can also use an ACN for identification purposes.

It is important to note that not all businesses are companies. Sometimes, an individual may say they run a ‘company’ when they mean that they run a sole trader business. A company is a particular business structure that is legally separate from its owners (called ‘shareholders’) and is managed by directors. Unlike other business entities like sole traders and trusts, ASIC strictly regulates companies. Accordingly, if directors mismanage the company, they may be subject to criminal and civil penalties.

A company that runs business activities will have an ABN and ACN. Once a company is set up, it will need to register for an ABN before it starts doing business. If the company only holds assets and is not directly involved in business activities, it may not need an ABN. The ACN is used as the base number for the ABN. This means they will be identical, except the ABN will have two additional numbers at the beginning.

How Do I Find an ABN or ACN?

You can search for an ABN on the Australian Business Register’s website.

You can search for a company’s ACN either on the Australian Business Register or on ASIC Connect. If you are looking for further information on the company, you should search for the company on ASIC Connect. There, you will find details of the company’s:

• registration date and status;
• documents it has lodged with ASIC;
• address;
• shareholders; and
• directors

How Do I Register an ABN?

You can register your business, company or trust for an ABN by applying through the Australian Business Register. If you would also like to register your business name, you can register both at once through the Business Registration Service.

You can reactivate a previous ABN by applying for a new number. The application will provide you with the opportunity to list your previous ABN. The ABN will be reactivated if your business structure has not changed and you are still eligible for an ABN.

There is no fee for applying for or reactivating an ABN, but registering your business name costs $85 for a three-year registration (or $36 for one year). If your application is successful, you will immediately receive your ABN.

Updating or Cancelling Your ABN

It is your responsibility to keep your ABN details up to date on the business register. This includes details of your:

• business’ owner;
• address;
• contact information; and
• GST registration status.

You must update these details within 28 days of the change.

If you wish to cancel your ABN, you must inform the Australian Business Register and check that the register displays the ABN as ‘cancelled’.

How Do I Register an ACN?

You will receive an ACN when you set up a company. You can choose to set up a company yourself through ASIC or ask a lawyer or accountant to help you.

Firstly, check that your chosen company name is available by searching the register. Also, check that there are no existing business names or trademarks similar to your chosen name. If there are, you may not be able to freely run your business under that name. You can search trade marks on IP Australia.

You should also read and fully understand your obligations as a company officeholder. A company officeholder includes directors and company secretaries. Furthermore, you should ensure that any other company officeholders are aware of these obligations and that you have obtained their consent to be an officeholder before setting up the company.

Directors' Duties Complete Guide

If you are a company director, complying with directors’ duties are core to adhering to corporate governance laws.
This guide will help you understand the directors’ duties that apply to you within the Australian corporate law framework.

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Key Takeaways

The ABN is the unique identifying number for all Australian businesses. No matter how small or large your business is, you must apply to the Australian Tax Office for an ABN. However, you only need an ACN if your business is a company. Indeed, companies have an ACN as their identifying number, and if the company carries on a business, it will have both an ABN and an ACN. A key difference between ABNs and ACNs is the registration process for each. For instance, while the Australian Business Register registers ABNs, you will need to obtain an ACN through the Australian Securities and Investments Commission.

LegalVision provides ongoing legal support for businesses through our fixed-fee legal membership. Our experienced business lawyers help businesses manage contracts, employment law, disputes, intellectual property, and more, with unlimited access to specialist lawyers for a fixed monthly fee. To learn more about LegalVision’s legal membership, call 1300 544 755 or visit our membership page.

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