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  • #987752
    EFP
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    I already have an ABN set up as Sole Trader and ACN. However for some contract work they require another ABN set up as a PTY LTD/Company. Not sure whether it is best to close original ABN as only set up in last 6 weeks. Will having two ABN’s mean I will need to keep seperate books/submit seperate BAS?

    Thanks for any advice in advance.

    #1164195
    al.giffard
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    Hi EFP,

    Firstly, to demystify ABNs a little bit, an ABN is a number that attaches to each “entity” (as in, individual/sole trader, partnership, company or trust), and each entity can only have one ABN. Generally, each entity prepares separate BASs and tax returns – so yes, operating as a sole trader (aka individual) and as a company would mean you’d be keeping separate books.

    However, if you do set up a company, you could consider operating everything as a company, and no longer operating as a sole trader. This could simplify the reporting requirements and leave you using just one ABN again. There are a whole range of factors to consider when thinking about your structure though, and it’s important to get professional advice before making this sort of decision, so you can fully consider the pros and cons of each structure option, and to make sure there are no (potentially very costly) surprises.

    Hope that answers your questions, though.

    Al

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