Guide

What is GST and how does it work?

Not clear on your GST commitments? Don’t stress. It’s not as tricky as you might think. Here’s what to focus on.

A small business owner filing GST

1. Do you need to register for GST

A small business owner registering for GST and graphics indicating when to register

Yes, if yearly turnover is $75K or more.

(It’s also compulsory if you want to claim a fuel tax credit, or you're a taxi or ride-sharing driver.)

Optional if yearly turnover is less than $75K.

2. Registering for GST

You can register online with the ATO. You’ll need an Australian business number (ABN).

3. Adding GST to your prices

A calculator showing GST calculations

Old price x 1.1 = GST inclusive price

4. Issuing tax invoices

A tax invoice

You need to be able to issue tax invoices (include those words), with extra details like:

  • the seller’s name and ABN
  • notes showing GST has been charged

5. Recording GST

Examples of how to record GST

Keep a running tally of the GST you’ve collected on sales.

Do the same for the GST you’ve paid on purchases.

You’ll use these numbers to figure out your GST bill or refund at step 6.

*You will most likely collect more than you pay.

6. Preparing a BAS (business activity statement)

A small business owner preparing a BAS form

Figure out your GST bill (or refund).

$2819.74 – $1342.87 = $1476.87 (Money you owe the ATO.)

Include this in your BAS and lodge it online with the ATO.

GST tip

Think of GST as money you’re collecting for the ATO. Treat it as their money and you won’t get caught short.

7. GST due dates

A calendar showing GST due dates

Most businesses lodge quarterly. You can check due dates on the ATO website.

Make GST less taxing

Learn how software can help with GST invoicing, accounting, and BAS lodgement.

Get this infographic and bonus ebook

Download our 'GST cheat sheet' infographic, and get a bonus ebook about GST.

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