Question 1

What is GST in Australia?

Accepted Answer

GST (Goods and Services Tax) is a broad-based tax of 10% on most goods, services, and other items sold or consumed in Australia. It was introduced on 1 July 2000 and is collected by the Australian Taxation Office (ATO). GST-registered businesses collect GST on behalf of the government and can claim credits for GST paid on business purchases.

Question 2

How do you calculate GST?

Accepted Answer

To add GST: multiply the GST-exclusive amount by 1.1 (or add 10%). For example, $100 + GST = $100 x 1.1 = $110. To find the GST component in a GST-inclusive price: divide by 11. For example, $110 inclusive contains $10 GST ($110 / 11 = $10). To remove GST: divide the GST-inclusive amount by 1.1. For example, $110 / 1.1 = $100 GST-exclusive.

Question 3

What does GST-exclusive mean?

Accepted Answer

GST-exclusive (or 'ex GST') means the price does not include the 10% GST. The actual amount you pay will be higher once GST is added. For example, a price listed as '$100 ex GST' means you will actually pay $110 including GST. Businesses often quote prices ex GST when selling to other businesses, since GST-registered businesses can claim the GST back as an input tax credit.

Question 4

Do I need to register for GST in Australia?

Accepted Answer

You must register for GST if your business has a GST turnover (gross income minus GST) of $75,000 or more per year ($150,000 for non-profit organisations). You must also register if you provide taxi or ride-sharing services regardless of turnover. Registration is optional if you're below these thresholds, but registering allows you to claim GST credits on business purchases. You register for GST through the ATO when you apply for an ABN.

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