There are a lot of businesses that have an Australian Business Number (ABN) which allows them to identify themselves. It is the ATO’s discretion whether or not to cancel your abn cancellation form. Those who run commercially viable businesses may get into serious trouble. Furthermore, a business that operates without an ABN can suffer a great deal of financial penalty. We will cover the reasons why your ABN may have been canceled, as well as how you can reactivate it.
If your ABN hasn’t been used for a year, the Australian Business Review (ABR) will probably cancel it
Make sure you lodge your business documents on time so the ABR knows your business is still operating
GST registered business owners are required to send their business activity statements regularly
It is possible to reactivate your ABN if it was accidentally canceled
My ABN was canceled, why?
Reviewing ABNs is the responsibility of the Australian Business Review (ABR). The ABR is highly regarded by industries worldwide as a reliable source of business information and makes sure that its data is up to date and accurate at least twice a year. ABR information is also used by government agencies when assessing grant possibilities. The ABR conducts regular reviews of ABNs that appear to be inactive, which are then reported to the ABR. Inactive ABNs include:
- You are not filing your business’s tax returns
- Not filing Business Activity Statements (BAS) on time
- If you’re a sole proprietor, failing to file a personal tax return
- Deregistration of your company by ASIC
- Other inactivity
ABNs may be canceled if they appear to not be associated with a business. An ABR representative will notify you in writing when your ABN is no longer valid, however. Changes to your business contact information should be reported to the ABR as soon as possible so important communication won’t be missed.
What Do I Do to Show That I Am Running a Business?
There are certain activities that make it clear that you are running a business to the ABR. These activities entitle you to keep your ABN.
- Maintaining accurate and timely records of all business documents
- The planning and execution of financial agreements, licensing agreements and the purchase of stock.
- You should run your business like a business once you’ve set it up! Does it generate profits? Which products and services do you offer? Are your records well organized and are your operations dependable?
- Take control of the situation. Having a relationship that looks like an employer-employee relationship, where you may be controlled and paid by someone else, does not signify you are operating an enterprise.
- Ensure that you declare income at the business labels when filing your income tax return.
- GST-registered businesses must report their business activities (BAS).
- Make sure your ABN is updated or canceled to reflect any changes in your company.
Your ABN may be canceled if you fail to meet one or more of these requirements. If you are not sent a letter from the ABR, then you can check the ABN Lookup to see if it has been canceled. In addition, you are not permitted to use your ABN for business purposes if your ABN was canceled. Cancellations are possible at any time, regardless of when you received notice.
There is some good news, though: You can reapply for an ABN even though some changes will be needed to your business activities.