Do I Need an ABN for My Online Business in Australia?

Short answer: Yes, almost certainly. If you're running an online business in Australia — even a side hustle from your kitchen table — you need an Australian Business Number (ABN). The good news: it's free, takes 10 minutes, and you'll have it before lunch.

Here's everything you actually need to know.

What Is an ABN?

An ABN is an 11-digit number that identifies your business to the ATO, suppliers, and customers. It's how the Australian government knows you exist as a business entity.

Important: An ABN is NOT a tax file number. You'll have both — your TFN (personal tax) and an ABN (business identifier).

When You Need an ABN

You need an ABN if you're:

Selling products or services with the intention of making a profit

Running a business (regardless of how small)

Invoicing other businesses

Wanting to register a business name

Planning to register for GST

Selling on certain marketplaces (Etsy, Amazon AU, etc. require it)

Quick test: If you're consistently selling things online to make money, you need an ABN. Selling old furniture on Gumtree once doesn't count. Running an online store does.

When You Probably Don't Need One

You might not need an ABN if:

You sell a personal item once or twice a year (garage sale level)

You earn less than $75K AND it's a hobby (rare for online stores)

You work a salaried job and your "side activity" isn't profit-driven

The ATO has a "hobby vs business" test. The factors:

1. Are you intending to make a profit? Yes = business

2. Is your activity repeated and regular? Yes = business

3. Is it organised in a business-like way? Yes = business

4. Is the size or scale similar to a business? Yes = business

If any of these are yes, get an ABN.

What Happens If You Don't Have One?

Two main consequences:

1. PAYG Withholding (Big One)

If you invoice another business without an ABN, they're legally required to withhold 47% of your payment for tax. They send it directly to the ATO. You'd have to claim it back at tax time.

Translation: Without an ABN, your business clients legally have to pay you 53 cents on the dollar.

2. Marketplace Restrictions

Many Aussie marketplaces (Etsy AU, Amazon AU, eBay AU as a business seller) require an ABN to sign up.

3. Loss of Business Deductions

You can still claim deductions without an ABN, but it's messier come tax time.

How to Get an ABN (10 Minutes)

Step 1: Decide Your Business Structure

Sole Trader (most common, simplest, free) — you and the business are legally one

Partnership — multiple people, similar to sole trader but shared

Company (PTY LTD) — separate legal entity, costs ~$500 to set up + annual fees

Trust — complex, get an accountant

For most new online stores: Start as a sole trader. You can switch to a company later.

Step 2: Apply Online

Go to abr.gov.au.

You'll need:

Your TFN

Identification details

Business activity description

Estimated annual turnover

Business address (your home address is fine)

Step 3: Submit and Wait

Most applications are approved instantly. Some take 1-2 business days for manual review.

Cost: Free. Don't pay any third-party "ABN service" — they just resell the free government form.

ABN vs ACN: What's the Difference?

	ABN	ACN
Stands for	Australian Business Number	Australian Company Number
Who needs it	Anyone running a business	Only companies (PTY LTD)
Issued by	ATO/ABR	ASIC
Cost	Free	~$500 setup + $290/year
Length	11 digits	9 digits
Does company need both?	Yes	Yes

You need an ABN. You only need an ACN if you've registered as a company.

Do I Need to Register a Business Name?

Separate question. Your ABN gives you the right to do business under your own legal name (e.g., "John Smith"). If you want to trade as anything else (e.g., "Smith Online Store"), you must register a business name.

Cost: $42 for 1 year, $98 for 3 years

Where: asic.gov.au

Required: Only if you trade under a name that's not your legal name

Once You Have Your ABN

Display it on:

Your website footer (legally required for businesses with an ABN)

Invoices to customers (required)

Quotes and proposals

Business cards (optional but professional)

Australian Consumer Law requires you to display your ABN on your website and invoices. The ATO can fine businesses that don't.

Updating or Cancelling

Your ABN should be updated within 28 days of any change:

New address

Adding or changing business activities

Stopping trading

You can also voluntarily cancel your ABN if you stop running a business. Done at the same site (abr.gov.au).

What About GST?

GST is separate from ABN. You need an ABN before you can register for GST. GST registration is only mandatory when your annual turnover hits $75K AUD.

Most new online stores have an ABN but aren't GST-registered for the first 1-2 years. Perfectly normal.

The Real-World Timeline for a New Online Store

Day	Action
Day 1	Apply for ABN online (10 min)
Day 1-2	ABN approved (often instant)
Day 1	Open business bank account using ABN
Day 2-7	Build your store, register business name if needed
Day 7+	Launch and start selling
Year 1+	Track revenue, register for GST when you hit $75K
Year 2+	Consider switching to PTY LTD if income justifies

Common Questions

Q: Can I have multiple businesses under one ABN? A: Yes, sole traders can run multiple business activities under one ABN. Just update your activity description if you change focus.

Q: I'm under 18 — can I get an ABN? A: Yes, you can apply at any age but you'll need a TFN first. If you're under 16, you may need a parent/guardian to manage things.

Q: What if I'm only selling to overseas customers? A: You still need an ABN if you're running it as a business in Australia.

Q: Can I use my home address? A: Yes. Most sole traders do.

Q: Will my address be public? A: Your registered business address appears on the ABN Lookup tool. If privacy is important, consider a virtual office or PO Box.

TL;DR

Almost every Aussie running an online store needs an ABN

Free, 10 minutes, apply at abr.gov.au

Sole trader is the simplest structure to start with

ABN ≠ GST (separate things, GST kicks in at $75K revenue)

Display your ABN on your website footer (legally required)

Don't pay any "ABN service" — the official one is free

If you're spending more time worrying about an ABN than building your business, just apply right now and move on. It's the easiest part of starting an online business in Australia.

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Once you've got your ABN, the real work begins. NicheKit's core course walks you through everything else — Stripe setup, store building, GST tracking, and getting your first sales.