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JacquiPryor
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Hi Leah,

If you have been working as a sole trader, the ABN really is yours rather than the business’s so if you are going to operate the online shop with you as the sole trader too, then the same ABN will be used. However, you might need to consider registering a new/separate business name for the online shop if it’s going to be called something else. You can have the abr or business names office link multiple business names to your ABN.

To answer:

– keep using my freelancing ABN and register a trademark

There are some differences between ABNs, Business Names, Trademarks to be understood – the ABN is an Australian Business Number – it identifies the ‘entity’ carrying on the business for a few reasons, but mostly for tax related reasons. As a sole trader you are the entity – a business name is basically an alias for whoever is behind the business, which is you. You must register a trading name/business name in your state if you are carrying on business by a name other than your own personal name. A trademark is not a ‘trading entity’ or for trading purposes. It is a ‘sign’ (be that a name, logo, slogan or other element) that you use to distinguish your business goods and services from others. By registering your trademark you gain the right to use that trademark for your goods/services (so no one can make you stop) and also control its use – this can be by licensing others to use it, or taking action against people found to be infringing.

So – it’s quite possible, if your online shop will go by a name different to the one you use for your freelance design that you will need to register a business name in your state; and, should consider registration of that name as a trademark – or at the very least, having a search done to make sure your chosen name doesn’t breach anyone else’s rights. Our office, along with many others can conduct preliminary trademark searches – http://www.australiantrademarks.com.au/FreeTrademarkSearch.php will let you do a free search with our office (no cost, no obligation etc) if that’s of any interest or help.

Essentially you would then have:

Leah Trading As ONLINE SHOP NAME under the ABN 11 111 111 111, and registered rights in ONLINE SHOP NAME if you did everything that’s described above.

– register a company?
An accountant will be best to advise on the ‘right’ structure for you. Unlike a business name (which is just an alias for whoever is carrying on the business), the company forms its own legal entity, which can then have it’s own ABN, and can own the trademark if you go down that path, and if necessary own the business name. It’s a bit more expensive to register a company than a business name, but can be well worth it, as it helps protect you from action/liability etc. If, for example, a customer wanted to make a complaint about your online business and you are a sole trader with a business name, the complaint is against you personally; as a company, the complaint would be against the company, so it kind of keeps you a step removed.

– Is it easy enough to transition from sole trader to company status (I know I’m probably phrasing everything wrong)?

I don’t believe you can ‘transform’ a business name (sole trader) to company, as they are different things and are registered through different departments etc. To ‘transition’ – I imagine you would register your company name and an ABN for that company and then conduct business from that point under the company rather than yourself. The design services could be on offer by the company with its new abn as well as the online shop, or, you could continue operating the design part as a sole trader with your own ABN that you already have. Again, an accountant would be best to provide advice here, as you want to make sure it’s done “right” especially when considering different tax obligations on you and your company etc.

– What difference is there registering from Australia for international trade?

This will likely depend on your meaning of ‘international trade’ – if you are based in and trading from Australia, this really is where you need to register – if you will have clients purchasing via your website, from you in Australia then I suggest making it transparent at your website that you are located in Australia. You need to be careful of inadvertently infringing trademarks in other countries by offering goods/services there.

There are lots of cases/articles etc on the subject, which is relatively new in the overall scheme of things, as the Internet is relatively new. It seems that the general finding in Australia is that for their to be an infringement by an overseas company they must be seen to have been specifically targeting and directing their promotions and goods/services etc to Australians (rather than simply Australians have come across the website of an overseas party). So, we would suggest generally that unless you have ensured you are not stepping on any toes overseas, don’t run specific marketing campaigns in other countries. Allow customers from outside of Australia find you, and, if you proceed with trademark registration here, you can then of course claim your mark to be registered in Australia.

That turned out to be a much longer post than originally intended :) Hope it gives you some food for thought.

All the best,