Registration
ABN cancellation
ABN cancellation is the process of cancelling your Australian Business Number with the Australian Business Register when you stop carrying on a business, so your details no longer appear as active.
ABN cancellation ends your business's active status on the Australian Business Register. It is something you should do when you no longer carry on an enterprise, for example when you close, sell or otherwise stop your business. Keeping an ABN you do not need can cause confusion, because customers and suppliers may continue to treat you as a business, and the ATO may expect obligations such as lodgments.
You can cancel an ABN using the online system, through a registered agent, or by contacting the ATO. Before you do, it is important to sort out other obligations. If you are registered for GST, you generally need to cancel that as well and lodge a final BAS. If you have employees, you must finalise PAYG withholding and superannuation, and any other registrations tied to your business should be reviewed.
There is a key difference between cancelling an ABN and cancelling GST registration. They are separate registrations. You can cancel GST registration while keeping the ABN, for example when your turnover falls under the threshold but you still operate. However, if you cancel your ABN because you stopped trading, you should also deal with GST, since you will no longer be carrying on an enterprise.
Cancellation does not wipe out past obligations. Any outstanding BAS, income tax returns, or debts remain, and the ATO can still pursue them. You will also need to keep your records for the usual period, which is generally five years, even though the business has stopped. The records may be needed if the ATO reviews earlier periods.
Another point is what happens to assets. If you were registered for GST and still hold assets bought with credits, GST can apply on cancellation of GST registration, so check this when you wind up. For income tax, selling assets can lead to balancing adjustments or capital gains tax, which is outside GST but is also part of closing a business.
Common mistakes include forgetting to cancel and then continuing to receive ATO correspondence, or cancelling the ABN too early while you still have final invoices to issue and BAS to lodge. If you may restart business later, you might need to apply for a new ABN or reinstate one, and the process depends on the circumstances.
This information is general in nature. To confirm the right sequence of steps for your situation, check with the ATO or a registered tax professional.
Worked example
Oscar sold his cafe on 30 June. In July he lodges his final BAS covering sales up to 30 June and includes GST of $90 on a coffee machine he kept and later gave away, worked out as $990 divided by 11. He then cancels his GST registration and his ABN online, keeps his records for five years, and confirms he has no unpaid PAYG withholding or super.
Practical tips
- Lodge your final BAS and finalise PAYG and super before or alongside cancelling your ABN.
- Keep your business records for at least five years after you stop trading.
- Cancelling GST and cancelling your ABN are separate steps, so check both are done.