Registering an ABN as a Sole Trader Versus a Company

If you’re about to register an ABN in Australia, you’ve probably already hit the first fork in the road: Do you apply as a sole trader, or do you register a company?

Honestly, it may sound like an easy choice, yet it’s one that affects your tax setup, compliance workload, and registration costs from day one. It’s a pattern we’ve covered dozens of times at Australian Business Magazine, and most of those founders wished they’d compared both paths before applying.

This guide does that comparison for you, so you can register a business in Australia with the right structure from the start.

How to Register an Australian Business Number (ABN) as a Sole Trader

Sole trader ABN registration is the simplest path, and most people wrap up the entire process in under ten minutes. You apply through the Australian Business Register’s secure online service using your

• Tax file number 
• Identity documents
• Date of birth 
• Expected business activities

If your application is successful, you’ll receive your ABN immediately. Print or save the confirmation page before you close it. 

But if it’s unsuccessful, the ABR will send you a refusal number that you can use as a reference number to contact them directly. In most cases, unsuccessful sole trader applications come down to incorrect identity details or missing information on the form.

The whole process is free, so there’s no cost barrier when you want to operate a small online business in Australia. Plenty of founders apply for an ABN as their very first registration step for that reason. 

Here’s a closer look at what you’ll need to register and how your business name fits in.

ABN Details You’ll Need as a Sole Trader

You’ll need your tax file number, proof of identity, expected business activities, and a start date before applying for an ABN. You don’t need a separate entity registration or any processing fee, and the whole thing takes about as long as ordering a coffee.

Have all of those documents ready before you begin, because if anything doesn’t match ATO records, your ABN application will come back as unsuccessful.

Linking a Business Name to Your Sole Trader ABN

Now, here’s the surprising part: your ABN doesn’t come with a business name. 

If you want to operate under anything other than your own legal name, you’ll need to register a business name separately through ASIC. And yes, that applies even if every customer in your suburb already knows you by that name.

The fee is $45 for one year or $104 for three years, and it’s a completely separate registration from your ABN. ASIC indexes these fees annually, so check the current rate on their website before you apply. 

And before you apply, confirm whether you’ll trade under your own name or a branded one. 

How Company Registrations Change the ABN Application Process

If you thought the sole trader route had paperwork, the company path is a whole different league. Companies in Australia can’t even apply for an ABN until they’ve gone through the Australian Securities and Investments Commission and received an Australian Company Number (ACN).

A lot of founders mix up the difference between an ABN and an ACN when they first start the registration. Your ACN is the number ASIC gives your company once it’s officially registered. Your ABN covers the tax and business registration side of things, and the two numbers come from completely separate government agencies (sole traders don’t deal with any of this).

From there, the paperwork gets heavier, so let’s look at what companies need to prepare and how the registration sequence plays out.

Business Details You’ll Need for a Company ABN

Companies face a longer list when they apply for an ABN. The application asks for your ACN, company name, registered office address, director names, and share structure. Each director also needs to provide their date of birth, proof of identity, and a signed consent form.

After you’ve submitted all of those business details, ASIC will review them during the processing stage. The registration fee is $636 upfront, but ASIC indexes this annually, so confirm the current figure on ASIC’s website before you submit. 

 If anything is missing, your application will come back as unsuccessful.

Why Your Business Structure Affects How You Apply for an ABN

Your business structure in Australia controls how many registration steps you’ll go through. Sole traders apply for an ABN straight through the ABR. Companies have to register with ASIC first, and the ABR won’t process a company ABN application without a valid ACN.

We’ve written about dozens of startup launches at Australian Business Magazine, and the same mistake keeps showing up. Founders skip the ASIC step, apply for an ABN too early, and the whole application gets rejected.

Once registration is sorted, companies still face ongoing annual review fees and reporting obligations that sole traders aren’t subject to. A partnership has its own registration requirements through the ABR but skips the ASIC layer entirely.

ABN Lookup, Government Agencies, and What to Do After You Register

Now, most of the founders we’ve spoken to at Australian Business Magazine didn’t realise how many government agencies they’d need to connect with after registration. The ATO looks after all tax registrations and reporting; ASIC handles obligations for registered companies. And the ABR keeps a public listing on record for every active ABN. 

That public record is the ABN Lookup page on the Australian Business Register. Anyone can verify your ABN there, and the listing identifies your business identity, registration date, and current details (all of that needs to stay accurate). 

If your address, structure, or business activities change, you’ll need to access the ABR system and update the details yourself. The same service lets you cancel your ABN if you close or restructure your business. 

On the ATO side, you’ll deal with pay-as-you-go withholding, PAYG reporting, and business activity statements. If any of that sounds unfamiliar, a registered tax agent can help you manage the payments. Another option is to contact the ATO through the chat service on their website. 

Should You Claim GST as a Sole Trader or a Company?

GST registration works the same way regardless of your business structure. 

Sole traders and companies share the same turnover threshold, the same lodgement rules, and the same entitlements to claim GST credits. The only variable is when you register. In fact, plenty of founders blow past the $75,000 turnover mark without registering until the ATO starts asking questions.

Here’s how GST applies across both structures:

You don’t have to wait until you hit the threshold to register (worth doing early if you’re spending big on equipment or stock). Registering before you hit $75,000 means you can claim GST credits on payments to suppliers straight away. For a sole trader or small enterprise, that can free up cash during the first year of operation.

Either way, if you haven’t decided on timing yet, contact a registered tax agent to walk you through the timing. You can also check the GST service page on the ATO website for government guidelines.

Choosing the Right ABN Registration for Your New Business

Most founders starting out on their own are better off with a sole trader registration. It costs nothing, takes minutes, and not everyone needs the complexity of a company. 

And if your revenue or business plan outgrows the sole trader setup down the line, you can always cancel and re-register under a different business structure in Australia. That switch usually makes sense when you’re moving into a partnership or larger enterprise, because company registration gives you the legal separation and ability to bring on investors. 

Whichever path you choose, sort out your business name, ABN, and structure before you register, and you’ll save yourself a lot of paperwork down the track.