Most people know what an ABN is, but what about the lesser mentioned ACN? An ACN, which stands for Australian Company Number, is a distinctive nine-digit number that is given to each registered company by the Australian Securities and Investments Commission (ASIC). While the ACN doesn’t get as much air time as ABN, this nine-digit number plays a pivotal role in business administration and gives insight into a company’s legal standing and organisational structure. Registering for an ACN is an essential step for every new company as it offers many benefits while also working to prevent potential legal and financial complications from arising in the future.
The Benefits Of Having An ACN
There are several advantages to a business having an ACN:
- Legal Entity: An ACN distinguishes your company as a separate legal entity from any personal assets and other businesses.
- Credibility: An ACN lends credibility to your business. It signifies that your business is registered and adheres to all Australian business regulations.
- Limited Liability: An ACN grants your business limited liability – this means that your personal assets are generally protected from business-related debts and liabilities.
- Access to Government Services: Many government programs and services, such as grants and licenses, may require an ACN as a condition for eligibility.
- Taxation Benefits: An ACN is essential for claiming tax credits.
ACN vs ABN - What’s The Difference?
ACNs and ABNs are used for different purposes in the Australian business landscape.
As mentioned earlier, an Australian Company Name (ACN) is a unique identifier for registered Australian companies that is used to track a company’s legal and financial activities.
An Australian Business Name (ABN) is a unique 11 digit number assigned to all businesses, including sole traders, partnerships, trusts, and companies. It’s used for tax-related purposes, including the Goods and Services Tax (GST) and business transactions.
While both ACN and ABN are essential for business operations, an ACN is specific to registered companies, whereas an ABN can be used by various types of businesses.
How Do I Register An ACN?
Registering an ACN for your company is a simple and straightforward process. Though, it’s important you have considered the following items before registering for one;
- Company Structure: Before applying for an ACN, decide on the type of company structure that best suits your business.
- Company Name: Ensure that your chosen company name is unique and not already registered. You can check company name availability on the ASIC website.
Once these factors are considered, you will need to fulfill the below:
- Application Form: To register your ACN, you’ll need to complete the application form on the ASIC website.
- Payment: Pay the registration fee that is required for the setting up of ACNs.
- Confirmation: After submitting your application and paying the fee, ASIC will assess your application and supply you with an ACN if successful.
How Do I Find An ABN Or ACN?
If you need to find an ACN or ABN for a specific business, you can follow these steps:
- Online Search: You can use online search tools provided by ASIC or the Australian Business Register (ABR) to find the ACN or ABN of a business.
- Contact the Business: If you can’t find the information online, you can contact the business directly and ask for their ACN or ABN.
- Check Invoices or Receipts: Business invoices and receipts often include the ABN or ACN of the company.
How Can I Update Or Cancel My ABN Or ACN?
Updating or canceling your ABN or ACN is crucial when there are changes in your business structure or if you decide to terminate business.
Updating Your ABN or ACN:
- Log in to the Australian Business Register (ABR) portal.
- Update your business details, including changes to business structure, address, and contact information.
- Submit the changes, and the updated details will be reflected in the ABR.
Canceling Your ABN or ACN:
- Notify the ABR or ASIC of your intention to cancel your ABN or ACN.
- Complete the necessary forms to deregister or cancel your business.
Do I Need An ACN Or ABN To Start A Business?
The need for an ACN or ABN depends on your business structure:
- Sole Trader: If you’re a sole trader, you’ll need an ABN. This allows you to conduct business transactions, including the issuing of invoices and claiming of tax deductions.
- Partnership: Partnerships also require an ABN to operate legally. Each partner should apply for an individual ABN.
- Company: If you’re registering a company, you’ll need an ACN. An ABN is also necessary for tax-related matters.
Whether you’re starting a new business or managing an existing one, having the right identifier number, either an ABN and/or an ACN is essential for your success. For more information on this topic, head to the ASIC website.