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ABN

Newbie

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Hi, 

 

I work full time as an employee for a business. 

I am a winemaker and I have been animating some wine tasting for another business. 

I do that about once a month. 

I am not the one organising the tasting, but the business organising it wants to pay me for those interventions. 

The business paying me as a contractor wants an invoice to be able to pay me. 

 

I wanted to know if I needed an ABN for this activity, knowing that the income is going to be really small, like $2000/ year max, and i probably will do it only with that same business. 

 

Thanks 

 

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Most helpful response

ATO Community Support

Replies 2

Hi @popo24,

 

Thank you for getting in touch with us!

 

Firstly you will need to determine if you are entitled to an ABN. You will do this through the ABR website using the ABN entitlement tool.

 

If the Business paying you as a contractor requests that you invoice them for your services and you are not entitled to an ABN then you would provide them with a Statement by a supplier.

 

Links

ABN entitlement

Statement by a supplier

3 REPLIES 3

Most helpful response

ATO Community Support

Replies 2

Hi @popo24,

 

Thank you for getting in touch with us!

 

Firstly you will need to determine if you are entitled to an ABN. You will do this through the ABR website using the ABN entitlement tool.

 

If the Business paying you as a contractor requests that you invoice them for your services and you are not entitled to an ABN then you would provide them with a Statement by a supplier.

 

Links

ABN entitlement

Statement by a supplier

Newbie

Replies 1

Hi, 

 

I already read the ABN entitlement tool but it is not really clear in that case for me, that is why i asked the question on that website : 

 

  • the activity is a significant commercial activity, involving commercial sales of products or services, and is of a reasonable size and scale : what is a significant commercial activity, or a reasonable size and scale ?
  • there is an intention to make a profit from the activity as demonstrated by a business plan – unlike with a hobby : my job is my hobby 
  • the activity is repeated : Just once a month maximum 
  • the activity is systematic, organised and carried on in a business-like way and records are kept YES 
  • the activity is carried on in a similar way to that of other businesses in the same or similar industry
  • the entity has relevant knowledge or skill.

I am a bit lost and cant find a clear answe... 

 

ATO Community Support

Replies 0

Hi @popo24,

 

The link at the bottom of that bit, Section 9-20 A New Tax System (Goods And Services Tax) Act 1999, should help us here.

 

             (1)  An enterprise is an activity, or series of activities, done:

                     (a)  in the form of a * business; or

                     (b)  in the form of an adventure or concern in the nature of trade

 

Remember that there is no single test to determine if you're carrying on an enterprise. You don't need to meet all of the examples to be carrying on a business, you just need to consider all the factors to help determine it. No one factor will make or break whether you're running a business.

 

Since you're meeting most of the facets, it's pretty safe to say that you're carrying on an enterprise:

  • Your initial intention might not have been to make a profit, but now you are.
  • You're repeating the activity.
  • The activity is systematic, organised and carried on in a business-like way, and maintaining records

 

Ultimately, we can't say yes or no - tax is self-assessed, so you'll need to decide for yourself, or by speaking to your tax agent.