Being asked to provide an Australian Business Number (ABN) before starting work typically indicates that you will be engaged as an independent contractor rather than an employee. This distinction is crucial because it affects your rights and obligations.
As a contractor, you are essentially running your own business, which means you won't receive the same benefits as an employee, such as paid leave or superannuation contributions from the employer. You'll also be responsible for your own tax payments and may need to arrange your own insurances, like workers' compensation.
It's important to understand these differences, as they have significant implications for your work arrangement and financial planning. Doing so, will mean that you do not receive the same benefits as an employee. This can include:
- Not being paid superannuation by the employee
- May not be protected under the workers compensation insurance meaning you will have to obtain your own insurance.
- The employer will not withhold tax from your pay, meaning you will have to make your own tax payments to the ATO.
If you're unsure about this setup, it's advisable to seek advice from a professional, such as an accountant or lawyer, to ensure that it aligns with your personal and professional goals.
For further guidance, contact Namecorp’s Support and Compliance Team either by phone on 1300 006 263 or via email at support@namecorp.com.au.