An individual carrying out a small business can trade under their own Australian Business Number (ABN). These individuals are self-employed individuals carrying out a business activity. Many tradespeople operate as a sole trader under their own ABN. There are eligibility rules to obtain an ABN and the ATO has guidelines surrounding eligibility of holding an ABN. The following are some instances where you will need an ABN:
- Carrying on an enterprise
- Commencing a business
- Registering a business name
- Issuing invoices for sales
- Registering for GST (Goods and Services Tax) and claiming GST credits
- Acting as a trustee
- Operating a charity
Advantages of sole trader:
- Low startup cost
- Can hire people
Disadvantages of sole trader:
- One is responsible for their own debts, assets and losses
- Liability is unlimited
If you would like to discuss with us more about your circumstance or register an ABN, please feel free to call us on 0452214559 and we shall assist you.