do i need an ABN

[Raffaella]

Hi everyone,

I hope someone out there can help me!? I have just started selling on the madeit website. I have sold a handful of items and one buyer has requested a meeting to see if there is potential to sell my scarves in her (physical) shop.
I am wondering whether I need an ABN or not. At the moment I am simply running this at a hobby.. but what happens come tax time?
Are there benefits of getting an ABN so then I can also claim all my purchases/materials etc? Or will it be deterimental in the end and i will get taxed on any small profit i make?

Thanks so much...
Raffael
'knot for darling'

[LoopyLou]

Raffael, probably something that an accountant can best answer for you. If you want to deal with a store wholesale/on consignment etc, you don't always need an ABN (some prefer though). If you are only making enough to classify as a hobby still, you can fill out the Hobbyist form with the ATO. This then works well for you and your stockist. Obviously, you need to do what works for you and your situation though.

[HMK]

If your business name is registered it wont hurt to get one and they dont cost.

One advantage is you can also buy your supplies at wholesale prices, as anyone that does supplies will require you to have an ABN.

As mentioned some retailers will require it as well.

[cpercydesigns]

I'm at the point where I'm wondering the same thing. I've finally made an appointment with an Accountant to see what I need to do if I have an ABA ie what type of book keeping etc.

If you want I'll keep you informed of how I go with the Accountant.

Christine

[lddesigns]

I have an ABN which allows me to buy fabric at wholesale. It costs you nothing so it can't hurt. I sell on here and at one market. I taught myself to do an excel spreadsheet for keeping the books. I list EVERYTHING I spend (postage, supplies, market site fees, stationary etc) or make (that list seems to be shorter!!) and sub-total my entries every month then do a full total etc. at the end of the year. I then print a hard copy and paste into a book so i can easily refer to that information. It's very easy - must be if I can do it.

[ZippyZippy]

Hi Christine

Wondering how you went with getting an ABN.
I too am contimplating an ABN - but worried about the paper work and tax stuff for as a "hobbyist"
At the moment I use the hobbyist form from the ATO, all retailers have been happy with that, it's more to get a more reliable stream of supplies.

Hope everyone has a nice weekend :)



I'm at the point where I'm wondering the same thing. I've finally made an appointment with an Accountant to see what I need to do if I have an ABA ie what type of book keeping etc.

If you want I'll keep you informed of how I go with the Accountant.

Christine

[cpercydesigns]

I did end up getting an ABN because I have started teaching crochet at a local shop and she required it. So I did the check list on the Aust. Tax site, it said I qualified so I got one. I'm still to see an Accountant. I've found one I just have to get my books in order.

This blog by Little Toot is very informative: http://littletootcreations.blogspot.com/2011/06/doing-it-right-checklist.html

Christine

[ZippyZippy]

Thanks for the link Christine - very useful article :)

Jacqueline.

[lulu's]

Hi everyone, I have been thinking the same thing about getting an ABN. I asked my book keeper if and when I need to get one. Apparently you don't require one unless you earn over $6,000.00 a year in which case you will need one and need to start paying tax. I also sell in peoples shops and I have not needed one because I do not earn over $6,000.00. I use MYOB to do all my partners book keeping and have started using it for my self. It is easy to use and great to work out my profits and losses and so on. Hope this helps, Kristen.

[Ollie Rose]

Apparently you don't require one unless you earn over $6,000.00 a year in which case you will need one and need to start paying tax

This is actually incorrect. You will pay GST if your business has a turn over of $75K+ (turnover, not what you earn). You do not need to charge and lodge GST under this, however your invoices are supposed to contain certain information about not being registered for GST.

Even if you don't make any money from your business some stores may require you to have an ABN. It all depends on the store. An ABN costs nothing to get so there is no harm in getting one. If you want to buy your supplies wholesale you will need one.

Little Toots post is a really good, especially on weighing up if you are a business or a hobby.