Home – New Forums Starting your journey ABN or stay on the books?

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  • #967600
    gstevens
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    Just a quick one. I have recently started a new job full time but I am still going to work part time at my old job. It would probably work out to be less than 5,000 a year extra.

    So would I be better to stay on the books and pay heaps of tax or get an ABN?

    What would the advantages of an ABN be? I would only be able to use it for this one purpose?

    #1027462
    Melinda B
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    So you’re planning to set yourself up as a sole trader and contract yourself out, is that right?

    If so, you need to check out I think it’s called ‘Services Clause’ where if more than 50% of your income (under your business) comes from one person then you are considered to be an employee of that business. Ask your accountant about it.

    You’ll be paying roughly the same amount of tax anyway, because your business income will be taxed the same as your employee income.

    #1027463
    Avatar Consulting
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    If you supply an ABN for a job this means you are a contractor running your own business. You will be responsible for your own legal compliance.

    Unless you also intend to change your hourly rate to at least double what you get as an employee, you will not have the money to run your business.

    If you get an ABN it is yours for life and for every ‘job’ you use it on. It is called an Australian BUSINESS Number for a reason. It means you are running your own business and all your income is taxed no matter how you earnt it. their is no advantage here for you to get an ABN.

    The only person who wins is your boss, who doesnt have to pay insurance for you when you get hurt. It will be your responsibility.

    #1027464
    Melinda B
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    Paul Baker, post: 32614 wrote:
    The only person who wins is your boss, who doesnt have to pay insurance for you when you get hurt. It will be your responsibility.
    Nor do they have to pay holiday pay, long service leave, superannuation, insurance, etc…..
    #1027465
    cookiejoe
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    Hi all,

    Please correct me if i am wrong. I think having an abn can have many other uses. abn represents YOU! i think somehow your credit rating will increase…like you will be more trusted. Are there any other uses?

    anyway, i am thinking if your business is only generating like $1000 a year, do you still need to do a tax return at the end of financial year?

    Cheers

    #1027466
    Melinda B
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    cookiejoe, post: 32772 wrote:
    Hi all,

    Please correct me if i am wrong. I think having an abn can have many other uses. abn represents YOU! i think somehow your credit rating will increase…like you will be more trusted. Are there any other uses?

    anyway, i am thinking if your business is only generating like $1000 a year, do you still need to do a tax return at the end of financial year?

    Cheers
    I’m not sure how having an ABN would help your credit rating or make you more trusted. The only people who care about your abn is the tax office and your suppliers – neither of which have anything to do with your credit.

    An abn is basically for business use for GST. It has nothing to do with ‘You’ personally, not like your tfn (tax file number).

    If your business is bringing in income then it is declarable as income, ALL income from ALL sources is declarable at tax time. If you’re only bringing in $1000 per year then you’re well and truly starving, and if you’re bringing in income from other sources then you definately have to declare it and pay tax on it – profit that is, not income.

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