ABN, TFN & GST for Startups (Australia) 2025 Guide

ABN, TFN and GST are the three core tax registrations most Australian startups must get right from day one because they determine how the business identifies itself to the ATO, how it reports income and tax, and whether it must charge and remit GST. In practice, the correct registrations (and timing) reduce ATO compliance risk, prevent avoidable GST and PAYG errors, and make BAS and year-end work substantially easier—particularly once you start issuing invoices, engaging contractors, paying founders, or scaling turnover.

What are ABN, TFN and GST registrations (and why do they matter for startups)?

ABN, TFN and GST are separate registrations with different legal purposes, and confusing them is a common startup compliance failure.

• ABN (Australian Business Number): A public identifier for a business/enterprise used for invoicing, quoting, and interacting with other businesses and government. ABNs are administered through the Australian Business Register (ABR) and used across the tax system.
• TFN (Tax File Number): A confidential identifier used by the ATO to track income tax obligations for an entity (and individuals). The entity’s TFN is critical for lodging the income tax return and managing ATO accounts.
• GST registration: Determines whether you must charge GST on taxable supplies, claim GST credits on business purchases, and lodge BAS reporting GST collected/paid.

According to ATO guidance on business registrations, ABN and GST are applied for via the Australian Business Register, and GST obligations are administered by the ATO (registration and ongoing reporting). Consideration must be given to entity type and whether the startup is “carrying on an enterprise” for ABN purposes.

Do startups need an ABN?

Most startups need an ABN as soon as they commence trading (or are genuinely commencing an enterprise), because customers, suppliers, and platforms commonly require it for onboarding and payment.

• Carrying on an enterprise (including activities done in the form of a business), rather than a hobby.
• Issuing invoices and expecting payment from customers.
• Registering for GST (you must have an ABN to register for GST).

• Withholding risk: If you invoice another business and don’t quote an ABN, the payer may be required to withhold tax at the top rate (commonly referred to as “no ABN withholding”), unless an exception applies. This is a frequent cashflow shock for early-stage founders.
• Credibility and onboarding friction: Many B2B customers will not set up a supplier without an ABN.

ATO reference point (authority): The ABN system is governed under the A New Tax System (Australian Business Number) Act 1999, and the ATO/ABR publishes guidance on “carrying on an enterprise” and ABN entitlement through the Australian Business Register.

Real-world scenario: “Pre-revenue SaaS with paying pilot customers”

Do startups need a TFN?

Yes—startups need a TFN for the entity that will lodge the income tax return, and the requirement differs depending on the structure.

• Sole trader: The individual’s TFN is used for business income in the individual return.
• Company: The company requires its own TFN (separate to directors).
• Trust: The trust requires its own TFN (separate to the trustee).

• Income tax lodgment and assessments
• Linking and managing ATO accounts
• PAYG withholding registrations if the startup employs staff or pays wages to founders as employees (common in venture-backed companies after early stage)

ATO reference point (authority): TFN administration and use is governed through tax administration law, and ATO guidance covers entity TFNs and registrations through its business registration and “starting a business” resources.

• Narrow deadlines for income tax lodgment
• PAYG withholding setup when first hiring
• ATO online services linking and correspondence management

When must a startup register for GST?

A startup must register for GST if it is carrying on an enterprise and its GST turnover meets the threshold.

• GST threshold (most businesses): $75,000 GST turnover (current threshold as applied by the ATO).
• Non-profit threshold: $150,000 GST turnover (not typical for startups, but relevant for NFP founders).
• GST turnover is based on revenue, not profit. It includes taxable and GST-free supplies, and excludes input-taxed supplies in many cases.

• Your current GST turnover is at or above the threshold, or
• Your projected GST turnover is likely to be at or above the threshold (e.g., signed contracts, committed pipeline).

You may choose to voluntarily register under the threshold, but it should be a deliberate decision based on customers, costs, and compliance capacity.

ATO reference point (authority): The GST framework is established under A New Tax System (Goods and Services Tax) Act 1999, and the ATO publishes detailed guidance on “GST turnover”, “when to register”, and “projected turnover” tests.

Immediate registration exception (must-register activities)

Should a startup voluntarily register for GST?

Voluntary GST registration can be beneficial, but it is not automatically “good practice” for every startup.

• Customer type:
• Cost base:
• Funding and governance:
• Compliance capability:

• The startup signs a $120,000 annual B2B contract early (even if not yet invoiced in full), or
• The startup incurs $200,000 in development and setup costs in Australia and wants to claim GST credits (subject to creditable purpose and tax invoice requirements).

What are the ongoing compliance obligations after registration?

Registrations are not “set and forget”. Each registration carries ongoing operational requirements.

• Business address
• Associates (where applicable)
• Trading names and contact details

• Misdirected ATO correspondence
• Customer onboarding delays
• Data mismatches across banks, payroll and accounting systems

• Correct GST treatment on sales: taxable vs GST-free vs input-taxed
• Tax invoices: compliant invoicing for taxable supplies
• BAS lodgment and payment/refund cycles: monthly/quarterly as required by the ATO
• Record keeping: to substantiate GST credits and reporting positions

ATO authority reference: The ATO sets BAS reporting and record-keeping expectations and may require substantiation for GST credits (valid tax invoices, correct attribution rules).

• PAYG withholding registration (ATO)
• Single Touch Payroll (STP) reporting through payroll software
• Superannuation compliance (Superannuation Guarantee obligations)

These commonly arise earlier than expected once founders move from drawings to wages in a company structure.

How do ABN, TFN and GST differ for sole traders vs companies vs trusts?

Entity choice changes what registrations are needed and how they are administered.

• Sole trader:

• Company (Pty Ltd):

• Trust:

Legislative context (authority): Income tax and entity taxation outcomes are governed by the Income Tax Assessment Act 1997 and Income Tax Assessment Act 1936 (including integrity provisions relevant to companies and trusts). Structural decisions should be made with professional advice.

What is the recommended registration workflow for startups in 2025?

A structured workflow reduces rework and ensures the accounting system is set up correctly from the start.

1. Confirm entity type and “carrying on an enterprise” position

1. Apply for ABN and TFN at formation

1. Assess GST threshold risk using projected turnover

1. Decide GST registration deliberately

1. Implement accounting processes that support BAS and tax

1. Review registrations as the startup scales

What are common ATO audit and compliance risk areas for startups?

ATO attention is often triggered by inconsistent reporting, refund claims, or record-keeping gaps.

• Claiming GST credits without valid tax invoices
• Incorrect GST classification (taxable vs GST-free vs input-taxed)
• Treating hobby activity as an enterprise (ABN entitlement issues)
• Not registering for GST when projected turnover clearly exceeds $75,000
• Poor separation of private and business spending, especially for sole traders

In established practice, the fastest way to reduce these risks is consistent data capture, clean bank reconciliation, and properly supported working papers.

How can automated reconciliation reduce BAS and GST errors?

Automated bank reconciliation materially reduces BAS error rates because GST treatment is applied consistently and exceptions are surfaced earlier.

• MyLedger (Fedix) advantage: Automated bank reconciliation can reduce reconciliation from 3–4 hours to 10–15 minutes per client (approximately 90% faster), with ~90% AI auto-categorisation for many transaction sets once patterns are learned.
• Traditional workflows (common in legacy and general small business tools): Manual coding, manual exception tracking, and spreadsheet-based working papers frequently extend BAS close by days.

This matters for startups because BAS errors often begin with inconsistent transaction coding in the first 3–6 months.

Next Steps: How Fedix can help your startup set up registrations and reporting

Fedix supports Australian accounting workflows by helping practices and finance teams move faster from bank data to reliable reporting. If your startup is registering for ABN, TFN and GST (or you are cleaning up after a delayed registration), consider implementing processes that make BAS-ready data the default.

• Use MyLedger by Fedix to streamline month-end close with AI-assisted categorisation, GST enforcement, and automated reconciliation workflows.
• Standardise your chart of accounts and GST mapping early so BAS and year-end tax work aligns with ATO expectations.
• Learn more at home.fedix.ai and assess whether MyLedger is suitable for your startup’s accounting workflow and your advisor’s compliance process.

Conclusion

ABN, TFN and GST registrations are foundational to Australian startup compliance because they govern how you trade, how you lodge, and whether you must charge and report GST. The ATO’s framework is clear: register correctly, register on time (particularly for GST at $75,000 projected/current turnover), and maintain records that substantiate your position. Startups that implement disciplined processes early—supported by automation—reduce ATO risk and materially lower the cost of compliance as they scale.

Frequently Asked Questions

Q: Do I need an ABN before I start selling?

Q: Can I have an ABN without registering for GST?

Q: When do I have to register for GST in Australia?

Q: What is the difference between an ABN and a TFN?

Q: If I register for GST, do I have to lodge BAS forever?

Disclaimer: This information is general in nature and reflects Australian tax settings as commonly applied in the 2025 context. Tax laws and ATO guidance can change, and outcomes depend on entity type and specific facts. Advice should be obtained from a registered tax agent or qualified accountant for your circumstances.