Home – New Forums Money matters Some basic tax advice please… Reply To: Some basic tax advice please…

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Lis Sowerbutts, post: 10325 wrote:
I understood that the only advantage of an ABN is that if you invoice an Australian business without one they will withhold 45% of the invoice for tax. If the OP is not invoicing – and its sounds like he isn’t – what’s the point?

ABN registration isn’t compulsory – unless you need to be GST registered (ie $75k turnover). Lis, you’re right in that your customers will withhold tax at the top marginal rate (46.5% incl Medicare) which obviously a small business would not want – if Amber is not selling to businesses and only making cash sales (below $75k pa) it’s probably not necessary (though still recommended). Not having an ABN is like not having a registered business but it all depends on your market as to whether this is an issue.

My comment really referred to the fact that, to survive, a small business would generally expect sales of more than $75k, but this obviously depends on the individual’s circumstances…..