July 25, 2025

Individuals with ABNs: 2025 Tax & Compliance Guide

Published:July 2025

Running a business—even just a side hustle—means you’re officially in tax territory. If you’ve got an ABN, the ATO has you on their radar. And that means rules, records, and responsibilities. This 2025 Gotax guide breaks down everything you need to know to survive (and thrive): from income reporting and claiming tax deductions to GST and PAYG instalments.

Who Needs an ABN?

You’ll need an ABN if you:

Run a business or trade under your name (sole trader, contractor, gig worker)
Invoice customers (not just earn wages)
Want to claim work-related tax deductions
Earn from platforms like Uber, Airtasker, Upwork or similar
Sell goods or services intending to make a profit

You likely don’t need an ABN if:

You only earn wages or salary as an employee
You’re selling personal stuff as a one-off
You only earn investment income (shares, rent, dividends)

FAQ: Do I need to lodge a tax return if I have an

ABN but didn’t make money? Yes! If you’ve registered an ABN, you’ll need to lodge a tax return Australia-wide—even with zero income. Otherwise, deregister it.

How to Apply for an ABN

Apply free via the Australian Business Register. You’ll need:

Your TFN (tax file number Australia)
Personal and business activity details

Most sole traders operate under their own name—no separate business name required unless you want one.

Start your return now

What Happens After You Get an ABN?

You must declare all ABN income in your online tax return
Complete the Business Schedule section
Keep records for 5 years
Possibly register for GST (more on that soon)

Pro Tip: Once you have an ABN, you’re considered a business in the ATO’s eyes. That means responsibility.

What Income Do You Declare?

All of it.

Invoices to clients
Gig income (Uber, Deliveroo, etc.)
Cash jobs
Crypto or barter trades (converted to AUD)
Overseas income from freelancing

FAQ: What if I was paid in crypto or trade?

Declare the market value in AUD at the time of payment.

FAQ: How do I declare this in my tax return?

Via the Business Schedule. Gotax makes it easy in our online tax return platform.

What Can You Claim as a Tax Deduction?

If it helps you earn your income, and it’s not private use—it’s likely deductible.

Common tax deductions Australia-wide for ABN holders:

Tools, equipment, and materials
Business % of phone and internet
Marketing and advertising
Insurance, bank fees, accounting
Travel, fuel, car expenses
Home office expenses
Software and training

FAQ: How to claim tax deductions if I don’t have receipts?

You’ll need at least a bank statement or supplier record. Keep proof for 5 years.

Home Office Deductions

Choose your method:

Fixed Rate (67c/hour):

Covers electricity, internet, phone, stationery
Requires a 4-week work log

Actual Cost Method:

Claim the business-use % of every cost
Requires detailed records

Car and Travel Expenses

Car

Cents per km (up to 5,000km @ 85c/km)
OR logbook method (business % of total car costs)

Travel

Flights, meals, accommodation (only if overnight + business-related)

FAQ: Can I claim my daily commute?

No. Only travel between work sites, clients, or business errands.

GST: Do You Need to Register?

You must register if your ABN income is $75,000 or more.

Once registered:

Add 10% GST to invoices
Lodge BAS (Business Activity Statement)
Pay GST to ATO
Claim GST on business expenses

PAYG Instalments

If you start earning a solid income, the ATO may ask you to prepay tax quarterly via PAYG.

Based on last year’s income
Can vary instalments if income drops

FAQ: How do I avoid a big tax bill?

Track income + set aside tax regularly. PAYG instalments help spread the load.

Record-Keeping Essentials

Keep all receipts/invoices for 5 years
Use a separate business bank account
Use software (like eCashbooks) or a spreadsheet

FAQ: Can the ATO ask for old receipts?

Yes. They can go back five years.

ATO Audit Triggers

Want to avoid the ATO’s magnifying glass? Avoid these:

Not declaring all income
Excessive or 100% deductions
No supporting documents
Not adjusting for private use

FAQ: What happens in a tax audit?

You’ll need to show receipts, bank records, and diaries. If not, deductions may be reversed.

Common ABN Mistakes

Registering too late for GST
Mixing personal and business expenses
Claiming full phone/home/car use
Missing super payment deadlines

ABN FAQs

Q: Can I have a job and an ABN?

A: Yes! Just report each separately in your tax return.

Q: Do I need a business name?

A: Only if not trading under your own name.

Q: What if I stop freelancing?

A: Cancel your ABN through the ABR.

Q: Can I claim super contributions?

A: Yes, if paid to your fund before 30 June—and it’s tax deductible.

Q: Do I need to lodge a tax return Australia if I didn’t earn much?

A: Yes. You must still finalise it, even if income is low or nil.

Q: When can I lodge my tax return 2025?

A: From 01 July 2025. But GoTax lets you start earlier and finalise once the ATO is ready.

Q: What is a TFN Declaration?

A: It’s a form you give your employer to link your tax file number to your job. Not needed for ABN work.

Q: How do I avoid paying too much tax?

A: Track your income and claim all eligible tax deductions Australia-wide. Use tools like eCashbooks.

Q: How fast is my tax refund time Australia-wide?

A: Generally 2–14 days once the ATO processes your return. GoTax helps you get it right, fast.

Q: Can I use myTax to lodge a tax return?

A: Yes, but GoTax’s online tax return is easier, faster, and funnier.

Q: What’s the best way to claim tax deductions?

A: Use GoTax’s Deduction Grabber to keep records and automate deduction tracking.

Q: Do I need to register for GST right away?

A: Only when you expect to earn $75,000 or more per year. Register earlier if you want to claim GST credits.

Q: Can I get help if I make a mistake in my return?

A: Yep. Contact GoTax, and we’ll sort it before the ATO comes knocking.

Q: Do I need to do BAS if I’m under $75K?

A: No. BAS is only required if you’re registered for GST.

Q: What is the Business Schedule?

A: It’s the section of your tax return where you report ABN income and deductions.

Q: Can I split expenses if I use something for business and personal?

A: Absolutely. Just work out the business-use percentage and claim that.

Q: Can I deduct education expenses?

A: Only if they directly relate to your current ABN income. That’s called self-education tax deductions.

Q: What if I only work part of the year?

A: You still report income and expenses for the time you did work. It’s all proportional.

Q: Can I lodge a return without a TFN?

A: You’ll need a tax file number Australia-wide to lodge. Apply for one first if you don’t have it.

Q: What happens if I don’t lodge my ABN tax return?

A: The ATO can issue penalties, late fees, and eventually cancel your ABN. Not worth the risk.

Q: Can I get a tax refund if I have ABN income?

A: Yes—especially if you’ve claimed eligible deductions or paid PAYG instalments during the year.

Q: Do I pay super for myself as an ABN holder?

A: Not compulsory, but highly recommended. You can claim personal super contributions as a tax deduction.

Where to Get Help

Need answers from someone who isn’t a robot? Derek's got your back.

Use our tools:

Final Word: Run It Right

If you’ve got an ABN, you’re in business—and the ATO expects you to act like it. Record everything. Declare everything. Claim only what’s fair. And for the love of refunds, don’t leave it to the last minute.

Start your tax return with GoTax today: https://www.gotax.com.au/guest-user

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ABN registered? You must complete the Business Schedule in your tax return.
Claim all eligible work-related tax deductions with proper receipts.
You must register for GST if your income hits $75K.
Super contributions before 30 June are tax deductible.
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Disclaimer

Note that the information provided is general in nature and subject to change. Please contact one of our professionals who can evaluate your circumstances and provide more accurate advice to your current situation.

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