Small businesses selling a mixture of gst and non-gst food items may be able to choose one of five simplified GST accounting methods offered by the tax office to estimate the gst content of sales.
A small business retailer for Simplified Accounting Method “SAM” eligibility purposes is a business with turnover of less than $2 million.
The five simplified methods are:
- Business norms percentages (only certain businesses)
- Stock purchases
- Snapshot of trading
- Sales percentage (only certain businesses)
- Purchases snapshot
See full details of the “SAM” (Simplified Accounting Methods) here: Simplified GST accounting methods for food retailers
GST Free Food
In general, food and beverages for human consumption are GST-free unless it is for consumption at the place of supply, or if it is hot food for consumption elsewhere.
However, the food GST classification rules are somewhat complex in practice.
Determining whether food is subject to GST can variously depend on the ingredients and manner of preparation, the place of preparation and the place, or intended place, of consumption (or intended consumption).
The tax office provides a GST food classification decision tool with a detailed food list for major food items to assist food vendors to accurately classify food items.
The food list has Ruling status, and as such provides limited protection if relied upon in good faith.
- GST Simplified Accounting Method Determination (No.38) 2016 for Restaurants, Cafes and Caterers – purchases snapshot method
- Goods and Services Tax: Simplified Accounting Methods Determination 2017 for Retailers who sell Food – Business Norms, Stock Purchases and Snapshot Methods
This page was last modified 2021-08-10