Register for GST

The Goods and Services Tax applies to most business activities, although there are some exclusions.

Registered businesses are required to add the tax (10%) to their sale value, and send it to the ATO on a regular basis. Before sending the tax to the ATO, a business subtracts the GST paid on its supply costs, so the general position is that GST applies to the business margin.

[Update] The government is expanding the GST net with effect from 1 July 2017 with the following measures:

  • include overseas supplies of digital products to Australian residents
  • reduce the existing $1,000 GST threshold for imports to zero, with overseas suppliers being required to collect GST for digital and physical products, subject to the Australian turnover threshold of $75,000

Follow developments of GST measures here: GST matters

General GST Registration Thresholds

The requirement for most businesses to register for GST arises if

  • you carry on a business, and
  • your annual business turnover is currently $75,000 or more, or for non-profit organisations – $150,000 or more.

– or if you provide taxi travel at any level of turnover or if you want to claim fuel tax credits

Where applicable, the turnover requirements are assessed at entity level, aggregating turnovers if there is more than one business.

“Uber Taxis”: The Tax Office consider that the activities of ride-sharing entities (such as Uber) are providing a form of taxi travel, and therefore fall within the mandatory requirement to register for GST, regardless of turnover. They were given until 1 August 2015 to register.

Exclusions

Sales not connected with a business, or nor connected with Australia, which are not taxable supplies (GST-free) or are input taxed are excluded from the GST turnover definition.

Input taxed sales are those without GST in their price, (regardless of whether GST was included in the input costs). The most common examples are financial supplies – such as interest on a loan – and the rent or sale of a residence.  GST credits cannot generally be claimed on the input costs of input-taxed sales, however financial supplies are subject to a lower limit concessionary threshold.

GST-free sales are those which are specifically excluded from taxability, but for which GST credits on input costs can generally be claimed. Examples include basic food, exports, sewerage and water, the sale of a business as a going concern, non-commercial activities of charities and most education and health services.

When Turnover is Measured

Turnover is measured on a 12 month snapshot which includes the current month. As soon as the threshold is reached, registration is required within 21 days.

The registration requirement is also triggered if your annual business turnover is projected to reach the threshold levels – unless reasons can be given for the projection not actually meeting the threshold amounts.

If your turnover is less than the threshold, then registration is voluntary, but must be maintained for 12 months. If substantial GST credits are available, possibly resulting in a net refund situation, new businesses (for example) will often have an incentive to register in order to be able to claim the GST credits on purchases or capital equipment.

Linkage With ABN

To obtain GST registration, charge GST and claim credits requires that the entity have an identifying Australian Business Number (ABN).

The ABN for companies and other entities registered with ASIC (not business names) is made up of the company’s 9-digit ASIC registration number (the ACN), with addition of two digits. All other entities will have an 11-digit number allocated.

Once registered, the ABN number is used for all GST purposes.

GST Registration

To register for an ABN and/ GST (and any associated registration requirements such as PAYG or Tax File Number) see:

See also

 

.
This page was last modified on 14 Aug 2017