Goods and Services Tax (GST) – a short snapshot!

GST was introduced in Australia on 1 July 2000. It is a broad-based tax of 10% on most goods, services and other items sold or consumed in Australia. The 10% rate is relatively low compared to other countries (15% in New Zealand and 20% in United Kingdom). GST replaced the Wholesale Sales Tax (WST), and a range of state-based taxes, with an objective to simplify the existing tax system. The introduction of GST led to changes in pricing around Australia, as the 10% became embedded in the price of the goods and services, making it less visible to consumers.  The introduction of GST was initially (and still can be) controversial, however it is now a well-established part of the Australian tax system that continues to adapt along the way.

There were also big changes for businesses and accounting firms too – the changes in legislation, as well as the ongoing compliance component to report and pay (or claim) your GST amounts.

A business must register for GST if:

• Your GST turnover (gross income minus GST) is $75,000 or more in a financial year. For non-profit organisations, the threshold is $150,000 or greater.
• You provide taxi or limousine travel (including ride-sourcing services like Uber, GoCatch, Didi or OLA) regardless of your GST turnover

Registering for GST is optional if your business or enterprise doesn’t fit into one of these categories. You can find more information on registering for GST here.

GST can be tricky to understand – unfortunately it’s not a blanket rule for all and there is more than one method to account for GST. But our friendly team at HQB Accountants Auditors Advisors is always ready to help with questions or further information, so please don’t hesitate to call.

– Heida Bell

Posted 17.10.2024

This article is compiled as a helpful guide for your private information and is subject to copyright. We suggest that you do not act solely on the basis of material contained in this article because items are of general nature only and may be liable to misinterpretation in particular circumstances. We recommend that our advice be sought before acting on any of these crucial areas.