If you’re planning to work for yourself in 2025-26, whether as a contractor, freelancer, delivery driver, online seller or service provider, you may need an Australian Business Number (ABN). Many people rush into the application without understanding what information is required or how the ATO assesses eligibility. Taking a few minutes to prepare can make the process smoother and help reduce the chance of delays.
This guide explains what you should know before applying for a sole trader ABN, written in simple, practical language for Australians starting or running a small business.
A sole trader ABN is an 11-digit number used to identify your business to clients, government agencies, banks and platforms. Sole traders use an ABN to invoice customers, register for GST, apply for a business name and receive payments for contracting or gig-work.
If you’re still learning what being a sole trader means, this article may help:
👉 What Is a Sole Trader in Australia?
Unlike a company, becoming a sole trader does not create a separate legal entity - you operate the business yourself.
Whether or not you need an ABN comes down to the type of activity you carry out and whether it is considered a business. In most cases, you will need an ABN if you provide services or sell goods with the intention of earning income.
People who commonly need a sole trader ABN include:
If you regularly invoice clients, complete ongoing work or supply services commercially, the ATO generally expects you to have an ABN.
For a full step-by-step guide on applying, you can also read:
👉 How to Apply for an ABN as a Sole Trader
The ATO issues ABNs to individuals who are carrying on, or intending to carry on, an enterprise. This doesn’t require a large operation - many sole traders begin with small, part-time or occasional work. What matters is the intention and commercial nature of the activity.
You’re generally eligible if you:
You may not be eligible if:
Understanding how the ATO distinguishes between a hobby and a business helps set clear expectations.
Many new sole traders worry about whether their activity is “big enough” to be a business. In reality, it’s less about size and more about intention.
A hobby usually involves activities done for personal enjoyment, with occasional or irregular income. Examples include selling handmade items casually or doing one-off tasks without structure.
A business, however, usually involves charging for services, accepting bookings, delivering goods, registering on work platforms or preparing to operate commercially. Even small or part-time work can be a business if it’s done for income.
If your activity resembles a business more than a hobby, an ABN is typically required.
While many ABN applications are approved instantly, some require manual review. The ATO may verify identity details, check whether the information provided is complete, or confirm that the activity appears to be a business.
They may look at:
Applications that require additional checks can take longer.
You don’t need to upload documents for an ABN, but you do need accurate details ready. Before starting, make sure you have:
These details help the ATO verify your identity and issue your ABN.
Most ABN application delays happen because of small mismatches or missing information. A few of the most common issues include:
Correcting these issues upfront helps ensure a smoother process.
An application may be declined if the ATO cannot confirm business activity or eligibility. This can happen if:
A decline does not prevent you from reapplying in the future once circumstances change.
Approval times vary depending on the information provided and whether the ATO needs to perform additional checks. The typical outcomes are:
You can apply through a number of channels, depending on your preference:
The official government website. Free to apply.
Useful if you are already engaging them for tax or business setup.
A private online service that presents the ABN application in plain English and securely lodges your information with the ATO.
Learn more about how the service works 👉 What Is Register My ABN?
Spend a moment reviewing the basics to ensure you’re ready:
If you drive for rideshare or expect your turnover to reach the GST threshold, you may also need to consider whether GST registration applies. 👉 Do Sole Traders Need GST?
Do all sole traders need an ABN?
Yes. If you provide services, invoice clients or operate a business, an ABN is generally required.
Is a TFN required?
A TFN helps the ATO verify your identity and is commonly used when applying for an ABN.
Do I need a business name?
Only if you trade under a name different from your own.
Can I update my ABN later?
Yes. You can update your contact details, address and registration information through the Australian Business Register.