Anybody who undertakes business in Australia requires an ABN (Australian Business Number), if you decide to register a company, you will receive an ACN Australian Company Number.
If you are thinking about starting a business or are going to Register a Company, then it is important to know the difference. Generally, both numbers must be present on most documents including:
- Business Letterheads
- Account Statements
What is the Difference Between an ACN and ABN?
Essentially, the difference between the two lies in types of businesses they are used for and what their purpose is.
What is an ABN?
An ABN is a unique 11-digit number given to any business that is undertaking any form of business in Australia. It is issued by the Australian Taxation Office (ATO) and its basic function is to allow the government to keep track of your business activity and taxes. It also provides as an identifier to other businesses that work you may work with. Whether you are a sole trader, a partnership or a company, you will need to register for an ABN.
What is an ACN?
An ACN, on the other hand, is issued specifically to businesses that wish to register as a company. It is a 9-digit number that is issued by the Australian Securities and Investments Commission (ASIC) and is an identifier to ASIC for the monitoring of company activities. It ensures to the public that they are dealing with a limited company. It should also be noted that a company’s ABN will include their ACN with an additional two digits.
Are you thinking about restructuring your business from a sole trader to a company? LawPath can help you register a company. Read our guide ‘Do I need a new ABN if I’m changing my business from a sole trader to a company?‘
LawPath can assist with ACN and ABN registrations. Contact a LawPath consultant on 1800LAWPATH to learn more about customising legal documents, obtaining a fixed-fee quote from our network of 750+ expert lawyers or to get answers to your legal questions.