Do You Need an ABN to Sell Online? (2020 Update)
If you're selling products online, it's likely that you'll need to register an Australian Business Number (ABN). Find out more here.
Are you selling goods online? If you are, you’ll likely need to register for an Australian Business Number (ABN). Having an ABN allows you to run your online operations as a business, and may be required by law. Further, you will need to have an ABN to register for the majority of Australian website domains. Read on to find out what you need to know about having an ABN for your online business.
What is an ABN?
ABNs are unique 11-digit numbers that allows you to conduct a business in Australia. You will need to provide relevant identification details in order to acquire one. Furthermore, if you want to register a business name, an ABN is required. If you already have one for another business, you can not use it for your online business.
Do you need an ABN to Sell Online?
If you are selling goods/services online, you need to decide whether you are selling as a hobby or a business. In simple terms, if you are operating as a business and the main reason behind selling the goods/services is to make profit then you must have an ABN. You will need to display it on invoices and receipts you issue to your customers. Furthermore, GST is another point of consideration regarding whether you should register one. You are required to register for GST if your online sales/ business has a turnover of more than $75,000 a year (before GST). If you make sufficient turnover to register for GST, you will also need to register an ABN. If you hire employees, you will need to have an ABN in order to register for PAYG Withholding.
Registering your domain name
Most domains names in Australia have the extension .com.au, .au or .net.au. If you want to register a domain name with one of these extensions, you will need to register for an ABN. Alternatively, you can apply for your domain name using your Australian Company Number (ACN) or trademark number). If you don’t have an ABN, you can register for a .id.au domain, however you cannot use this website for commercial purposes.
Why Else Would I Register for One?
Regardless of whether your online operations are a business or a hobby, we advise you to register for an ABN. It will enchance the legitimatcy of your business to your customers including one on your tax invoices or website. Moreover, it allows you to claim back GST credits and will assist you in making operations with other businesses an easier experience.
Therefore, while it may not be legally required, it is advisable to register an ABN if you are selling online. If you need assistance registering one, get in contact with a business formation lawyer for relevant legal advice. For further information about selling online on platforms such as Etsy, eBay or Facebook please refer to our other legal guides.
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.