Published on September 05, 2012 Do you need an ABN to open an online shop?
If you’re starting any type of business in Australia and plan on trading in the name of the business (and not just in your own name), then you will require an Australian Business Number (ABN) to do so.
This is because trading in a business name makes it’s clear to buyers that you’re not just selling odd things for a hobby but you are an organised business. You therefore must be registered as a business, even if you are a home based sole-proprietor selling online-only.
The rules apply equally regardless of the type of business that you’re running. It doesn’t matter if you are selling online-only, offline-only or a combination of the two.
You will require an ABN or an Australian trademark to register a domain name (e.g., yourshop.com.au), so if you are running your own online shop and want to make it successful you will almost always require an ABN before you get started with your store.
GST registration
If you expect your turnover to be over the ATO’s GST threshold (currently $75,000 for businesses or $150,000 for non-profit organisations) or if you provide taxi-travel services as part of what you offer, then you will also be required to register for GST.
If you wish to claim back GST on purchases, you can volunteer to register for GST below this level as well but that depends on your business. It can sometimes add to the credibility of your organisation to have registered for GST as it shows the buyer you are serious about succeeding and they may also assume that your turnover is higher than the threshold whether it is or not.
The full details on the ATO’s requirements are found on the ATO’s website. See this article: https://www.ato.gov.au/business/registration/work-out-which-registrations-you-need/taxation-registrations/goods-and-services-tax/ which specifically deals with GST registration.
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