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Do You need an ABN to Sell on Facebook?

Do You need an ABN to Sell on Facebook?

Learn whether you need an Australian Business Number (ABN) for selling products over Facebook.

23rd April 2015

In this series of posts we’re looking at common questions that arise regarding when it’s appropriate to register for an ABN.Do you have a Facebook Store Account? You may need to consider registering as a business.

Do You need an ABN to Sell on Facebook?

The answer to this question is based on your profit and intentions for your Facebook Store Account when selling on Facebook. Are you running a business or is it a hobby?  Anyone can apply for an ABN, but you will only receive one if you are entitled.

You are entitled to an ABN if you are:

  • carrying on an enterprise in Australia
  • in the course of carrying on an enterprise make supplies connected with Australia or
  • have undertaken sufficient activities to commence an enterprise
  • able to demonstrate that you have a business structure in place

A hobby is not an activity that is considered an enterprise. However, if you have a business plan in place, carry on in a businesslike manner and records are kept, it is considered an enterprise.  Hence the decision will be up to you and how you conduct your Facebook Store Account.

Acquiring an ABN is advisable due to the benefits: the ability to claim back goods and services tax (GST) credits, claim fuel tax credits you quality for, register to use the pay-as-you-go withholding system, be able to offer fringe benefits to employees, and making dealing with other businesses a smooth process.  Whilst you will still need to claim profit using your Tax File Number for your hobby if you don’t have an ABN, it is also a matter of being future focused and not getting caught out with tax when your “hobby” takes off.

You must register for GST if your Facebook Store makes over $75,000 in a financial year. This process will require an ABN. PayPal can provide an invoice for your customer.

If you are still unsure about whether selling on Facebook is a Business or a Hobby please refer to our legal blog on Do You Need an ABN for a Hobby?

Unsure where to start? Contact a LawPath consultant on 1800LAWPATH to learn more about customising legal documents, obtaining a fixed-fee quote from our network of 600+ expert lawyers or to get answers to your legal questions.

Dominic Woolrych

Dominic is the CEO of Lawpath, dedicating his days to making legal easier, faster and more accessible to businesses. Dominic is a recognised thought-leader in Australian legal disruption, and was recognised as a winner of the 2015 Australian Legal Innovation Index.