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How to Check an ABN -

Since 1 July 2000, the tax laws require a business to ensure that a supplier provides them a valid ABN on their invoice.Ú If the supplier does not have an ABN, or the ABN is believed to be false, you are required to deduct tax at 48.5% from the invoice amount.

What are the rules ?

The new PAYG withholding rules require PAYG tax to be deducted at 48.5% where a business you deal with does NOT have an ABN or provides you a false ABN.Ú These rules only apply to business to business transactions (ie. not at home).Ú The tax withheld is credited against the businesses final tax liability.Ú Where tax is withheld, you must provide the business a «Payment Summaryˇ.Ú You must withhold tax at 48.5% if:

š         you are a business making payment for a supply to you; and

š         the supplier of the goods or services has not quoted their ABN on an invoice or similar document


You do not require the supplier to provide their ABN where:

š         you are an individual and the payment is wholly a private or domestic nature (eg. baby sitting or house cleaning);

š         the payment does not exceed $50;

š         the payment is exempt income to the recipient (eg. payment to a charity); or

š         the recipient is an individual and has made a written, signed statement that the supply is private or domestic in nature, or relates to a hobby (unless you have reasonable grounds to believe the statement is false).

False ABN

Generally, you are entitled to rely on quoted ABNs being genuine.Ú ABNs will be 11 digits, or 14 digits where it is a branch.Ú If you think the ABN quoted on an invoice is false or is not a real ABN, you must withhold 48.5% tax.Ú A «payment summaryˇ must also be issued to any person from whom you withhold the 48.5% tax.

For more details, obtain a copy of our «Tax Made Easyˇ guide available from Our Products.Ú

How to check an ABN

The Tax Office allows you to check an ABN over the internet.Ú To check an ABN, click on Check ABN.Ú Follow the instructions at this site and then return to us.Ú


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