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The ATO recently announced it will review the entitlement of recently issued ABNs. The Australian Business Register (ABR) receives a high number of ABN registrations per month and wishes to ensure ABNs are only being issued where there is an entitlement.
Cleardocs has been arranging ABNs on behalf of customers for some months now. The ATO's eligibility criteria for ABNs for companies, trusts and SMSFs are outlined on the Cleardocs website and I revisit them below.Cassandra Townsend, Thomson Reuters
The ABR receives about 80,000 ABN registrations applications each month. Approximately 91% of applications result in registrations being issued on the spot. The main reason for ABNs not being issued on the spot is a failure to establish the identity of the people behind the business (the associates).
The ATO says it has selected a representative sample of ABNs to review entitlement. It said these reviews will inform future focus areas to reduce the number of people applying for and receiving ABNs when they are not entitled.
When you order your ABN through Cleardocs, you will be asked questions about the entity's situation. These questions, and the information on our site, will help determine the entity's entitlement to an ABN. The ATO's criteria is reproduced below:
Companies To be entitled to an ABN, the company must:
Trusts To be entitled to an ABN, a trust must be carrying on an enterprise and also have 3 essential elements:
SMSFs If an SMSF has the following in place, it can obtain an ABN:
In coming months, we will publish an article with tips for your ABN application. Also, you can read earlier ClearLaw articles on a range of topics.
Leigh is a partner in the Maddocks Tax & Revenue team.
Leigh regularly provides advice on:
His advice covers both direct and indirect tax considerations.
Leigh advises Australian and multinational companies, high net worth individuals, accountants and financial advisers on all areas of taxation law.
The legal information and commentary on this site is general only. Documents ordered through Cleardocs affect the user's legal rights and liabilities. To assess their suitability for the user, legal accounting and financial advice must be obtained.