Understanding GST for Australian Businesses

What is GST?

The Goods and Services Tax (GST) is a broad-based 10% tax on most goods and services sold or consumed in Australia. It was introduced on 1 July 2000 and is administered by the ATO.

When Must You Register?

You must register for GST if your business has a current or projected annual turnover of $75,000 or more. Not-for-profit organisations have a higher threshold of $150,000. Taxi and ride-sharing drivers must register regardless of turnover.

What is GST-Free?

Certain supplies are GST-free, meaning no GST is charged. These include most basic food items, some education courses, some medical and health services, exports, and certain charitable activities. Input-taxed supplies like residential rent and most financial services are different -- no GST is charged, but you also cannot claim GST credits on related purchases.

Claiming GST Credits

When you pay GST on business purchases, you can claim those amounts back as GST credits (also called input tax credits) on your BAS. To claim, you need a valid tax invoice, the purchase must be for your business, and the amount must be $82.50 or more (including GST) for purchases where a tax invoice is required.

Record Keeping

You must keep records of all sales and purchases for at least five years. This includes tax invoices, receipts, and records showing how you calculated your GST. Digital records are acceptable provided they are accurate and accessible.

How Kumry Helps

Kumry can suggest a GST code for a transaction and show why it suggested it. Someone who knows your business still needs to review your transactions, their tax codes and anything flagged. Kumry doesn’t decide your GST for you and doesn’t guarantee you are compliant.