Your ABN on invoices: the 47% no-ABN withholding, ACNs and business names

Your Australian Business Number (ABN) is the one detail every Australian invoice should carry. A tax invoice must show it. Even when you're not registered for GST, leaving it off can mean your client holds back almost half of what they owe you.

This guide explains the ABN's format, the 47% no-ABN withholding and its exceptions, when a company shows its ACN, and what ASIC says about business names. The free invoice generator prints your ABN under your name on every invoice and checks it as you type.

What an ABN looks like

An ABN has 11 digits: a 9-digit identifier with two check digits in front. It's usually written in groups of 2, 3, 3 and 3:

ABN 51 824 753 556

The check digits mean a typo usually produces a number that fails the check. Invoice Native runs the Australian Business Register's check as you type and flags a number that can't be right. It doesn't look the number up online, so check your details on ABN Lookup if you're unsure. Your clients can use ABN Lookup to check you, too.

Sole traders use their individual ABN. Partnerships, companies and trusts each have their own.

The 47% no-ABN withholding

If you supply goods or services to a business and don't quote your ABN on an invoice or other document by the time you're paid, the payer generally must withhold 47% of the payment for the ATO. The rate has been 47% since 1 July 2017: the top marginal tax rate of 45% plus the 2% Medicare levy.

That's why Invoice Native warns you when the ABN field is empty, even when you're not registered for GST: "Without an ABN on your invoice, your client must withhold 47% of the payment for the ATO."

When no ABN is needed

The payer doesn't have to withhold if an exception applies. The supplier usually documents it on the ATO's Statement by a supplier form. The exceptions include:

• you're not carrying on an enterprise in Australia;
• you're under 18 and paid no more than $350 a week;
• the payment is $75 or less, excluding GST;
• the supply is wholly input taxed;
• the supply is a hobby or private recreational pursuit, or wholly private or domestic;
• there's no reasonable expectation of profit;
• the payment is exempt income.

The statement isn't a way around getting an ABN. If you're entitled to one because you run a business, quote it.

Companies: the ACN

A company also has a 9-digit Australian Company Number (ACN), written 004 085 616. Under section 153 of the Corporations Act, a company must show its full name and ACN on the first page of its invoices, statements of account, receipts, orders, letterhead, notices and cheques. The label can be "ACN", "A.C.N." or "Australian Company Number", and the number sits next to the name.

A company can show its ABN instead when the ABN is the ACN with two digits in front, so the last nine digits match:

Business cards, envelopes, packaging and machine-printed receipts don't need it. Invoice Native prints the ACN next to the company name only when it's set and the ABN doesn't already contain it.

Business names

If you trade under any name other than your own, you generally have to register it with ASIC. You don't need to register:

• an individual's first name and surname only: "John Smith" is fine, but "John Smith Plumbing" needs registering;
• partners trading under all their names;
• a company trading under its exact company name.

You need an ABN to register a business name. ASIC says you must include your registered business name and ABN on business documents such as invoices. You don't need to show the business name registration number. Invoice Native prints "Jane Citizen trading as Jane's Gardens" when you add a trading name; see invoicing as a sole trader.

Why contractors' details matter

Businesses that pay contractors for building and construction, cleaning, courier and road freight, IT, or security services may have to lodge a taxable payments annual report with the ATO. It lists each contractor's ABN, name and address and the amount paid. If you work in those industries, a correct ABN, name and address on your invoices makes your client's report straightforward.

Checklist

• ✅ Your ABN on every invoice, GST-registered or not
• ✅ Written as 11 digits, such as 51 824 753 556
• ✅ Companies: name and ACN on page one, or an ABN that contains the ACN
• ✅ Your registered business name, if you trade under one
• ✅ Your client's ABN when they give it, on larger tax invoices

Rules can change, so check the ATO's and ASIC's guidance or ask a registered tax agent about your situation. Invoice Native does not provide tax advice.