GST… what is it?

You’ve probably heard of GST before and think it’s a simple question to answer; however, many new business owners don’t actually understand the fundamentals of what GST is – it stands for Goods and Services Tax and is included in the price of almost everything we buy in Australia.

✎ How can GST affect your business?

If you’re a business, you may be required to register for and collect GST. 

This means:

- You may need to add GST to your prices.

- You will need to send that extra money to the ATO.

- You can claim back any GST that you’re charged on eligible business supplies and expenses.

✎ How much is GST?

- A GST registered business must charge an additional 10% of their invoice total to remit to the ATO. 

- GST is charged on most Goods and Services in Australia, but not all of them.

✎ Who needs to register for GST?

- Australian based businesses with an annual turnover of $75,000 or more.

If your annual turnover is under the threshold, you can voluntarily register for GST. There are benefits of registering your business for GST, but there will also be extra things for you to think about so it’s good to speak with a knowledgeable professional and weigh up your options first.

As a GST-registered business you’ll need to let the Australian Taxation Office know how much GST you’ve collected on income and how much you’ve paid on expenses. You do this by completing a Business Activity Statement (BAS).

What is a BAS? Stay tuned we’ll have more information coming about this!