What is the Australian standard for GST record keeping?

The Australian Taxation Office (ATO) requires businesses to keep records for five years after the transaction or the lodgment of the relevant Business Activity Statement (BAS), whichever is later. These records must be in English and easily accessible, either electronically or in hard copy, to support all GST claims and payments.

What is the difference between GST-free and input-taxed sales?

GST-free sales are sales where no GST is charged, and you can still claim GST credits for purchases related to making those sales. Input-taxed sales, conversely, also have no GST charged, but you generally cannot claim GST credits for purchases related to making these sales. Examples include financial supplies and residential rent.

How often do Australian businesses typically lodge Business Activity Statements (BAS)?

Most small businesses in Australia lodge their Business Activity Statements (BAS) quarterly. However, if your GST turnover is $20 million or more, you must lodge monthly. If your GST turnover is less than $75,000 (and you are voluntarily registered), you may be able to lodge annually. The ATO determines your reporting cycle.

Do I need to register for GST and when should I do it?

Understanding your Goods and Services Tax (GST) obligations is crucial for any Australian business owner. Registering for GST means you'll need to charge GST on your sales and can claim GST credits on your business purchases, impacting your pricing, cash flow, and reporting requirements.

Skill level: General guidance
Time: Varies
Trade: Bookkeeping & Cashflow
Updated: 4 November 2026

Why is understanding GST crucial for Australian tradies?

What are the key GST obligations for Australian businesses?

GST Threshold: In Australia, you generally must register for GST if your business or enterprise has a GST turnover of $75,000 or more (or $150,000 or more for non-profit organisations). This threshold is reviewed periodically by the ATO. Calculating GST Turnover: Your GST turnover is your gross income (excluding GST) from sales connected with Australia. It's not just your profit; it's your total sales revenue. Voluntary Registration: Even if you're below the threshold, you can choose to register for GST voluntarily. This might be beneficial if your business makes significant taxable purchases and you want to claim GST credits. Impact on Pricing: Once registered, you'll need to add 10% GST to most of your sales. This needs to be factored into your pricing strategy to remain competitive and profitable. Reporting Requirements: Registering for GST means you'll need to lodge Business Activity Statements (BAS) with the ATO, typically quarterly, to report your GST collected and paid.

How can a bookkeeper assist with GST compliance for tradies?
Accurate Turnover Calculation: A bookkeeper would help you precisely calculate your projected and actual GST turnover, ensuring you include all relevant income streams and exclude any GST-free sales. Cash Flow Implications: They'd assess how GST registration will affect your cash flow, considering the timing of GST payments to the ATO versus when you collect it from customers. Pricing Strategy Adjustments: Reviewing your current pricing and advising on how to incorporate GST without alienating customers or eroding your margins. Software Setup: Ensuring your accounting software (like Xero, MYOB, or QuickBooks) is correctly configured for GST, making BAS preparation much smoother. Compliance Obligations: Explaining your ongoing responsibilities, including issuing tax invoices, keeping proper records, and lodging BAS on time.

Common Costly Mistakes

Missing the Threshold: Not tracking turnover accurately and failing to register for GST once you hit the threshold, leading to penalties from the ATO. Incorrectly Charging GST: Charging GST when you shouldn't, or not charging it when you should, causing pricing errors and potential ATO issues. Poor Record Keeping: Not keeping proper tax invoices for purchases, meaning you can't claim all eligible GST credits. Late BAS Lodgement: Missing BAS deadlines, which can result in fines and interest charges from the ATO.

When To Get Professional Help

If you're approaching the $75,000 GST turnover threshold, or if you're considering voluntary registration, it's a sensible time to speak with a professional. Navigating GST rules can be complex, and getting it right from the start saves time and avoids potential penalties down the track.

Talk To A Specialist

Understanding your GST obligations is a critical step for your business. For a personalised assessment of your situation and to ensure you're set up correctly, consider a bookkeeping health check. We can help you navigate the complexities of GST registration and ongoing compliance. Visit us at /finance/enquire?service=bookkeeping to learn more.

Frequently Asked Questions

How do I know if I've reached the $75,000 GST threshold?

You calculate your GST turnover by adding up your gross income (excluding GST) from sales connected with Australia over the last 12 months, and your projected gross income for the next 12 months. If either of these figures meets or exceeds $75,000, you generally need to register. The ATO provides detailed guidance on this.

What happens if I don't register for GST when I should?

If you don't register for GST once you've met the threshold, the ATO can backdate your registration to the date you should have registered. This means you could be liable for GST on all your sales from that date, even if you didn't charge it to your customers, and may face penalties.

Can I claim GST credits on purchases before I register?

Generally, no. You can only claim GST credits on purchases made after your GST registration date. However, there are some specific rules around claiming GST credits for purchases made up to four years before registration, provided they relate to your business and you hold a tax invoice.

How often do I have to lodge my BAS once I'm registered for GST?

Most small businesses lodge their Business Activity Statements (BAS) quarterly. However, if your GST turnover is very high (over $20 million), you might need to lodge monthly. If your turnover is under $75,000 and you've voluntarily registered, you might be able to lodge annually.

What is a tax invoice and why is it important?

A tax invoice is a document that shows details of a sale, including the amount of GST charged. When you're GST-registered, you must issue tax invoices for sales over $82.50 (including GST). You also need to receive valid tax invoices for your business purchases to be able to claim GST credits.

Important — General Information Only

This content provides general information only and is not personal bookkeeping or cash flow advice. It does not take into account your objectives, financial situation or needs. You should consider your circumstances and seek advice from a registered BAS agent or other licensed/registered professional before acting on any information. The ATO and Tax Practitioners Board are authoritative sources for GST and compliance information.

Frequently asked questions

How do I know if I've reached the $75,000 GST threshold?: You calculate your GST turnover by adding up your gross income (excluding GST) from sales connected with Australia over the last 12 months, and your projected gross income for the next 12 months. If either of these figures meets or exceeds $75,000, you generally need to register. The ATO provides detailed guidance on this.
What happens if I don't register for GST when I should?: If you don't register for GST once you've met the threshold, the ATO can backdate your registration to the date you should have registered. This means you could be liable for GST on all your sales from that date, even if you didn't charge it to your customers, and may face penalties.
Can I claim GST credits on purchases before I register?: Generally, no. You can only claim GST credits on purchases made after your GST registration date. However, there are some specific rules around claiming GST credits for purchases made up to four years before registration, provided they relate to your business and you hold a tax invoice.
How often do I have to lodge my BAS once I'm registered for GST?: Most small businesses lodge their Business Activity Statements (BAS) quarterly. However, if your GST turnover is very high (over $20 million), you might need to lodge monthly. If your turnover is under $75,000 and you've voluntarily registered, you might be able to lodge annually.
What is a tax invoice and why is it important?: A tax invoice is a document that shows details of a sale, including the amount of GST charged. When you're GST-registered, you must issue tax invoices for sales over $82.50 (including GST). You also need to receive valid tax invoices for your business purchases to be able to claim GST credits.
What is the Australian standard for GST record keeping?: The Australian Taxation Office (ATO) requires businesses to keep records for five years after the transaction or the lodgment of the relevant Business Activity Statement (BAS), whichever is later. These records must be in English and easily accessible, either electronically or in hard copy, to support all GST claims and payments.
What is the difference between GST-free and input-taxed sales?: GST-free sales are sales where no GST is charged, and you can still claim GST credits for purchases related to making those sales. Input-taxed sales, conversely, also have no GST charged, but you generally cannot claim GST credits for purchases related to making these sales. Examples include financial supplies and residential rent.
How often do Australian businesses typically lodge Business Activity Statements (BAS)?: Most small businesses in Australia lodge their Business Activity Statements (BAS) quarterly. However, if your GST turnover is $20 million or more, you must lodge monthly. If your GST turnover is less than $75,000 (and you are voluntarily registered), you may be able to lodge annually. The ATO determines your reporting cycle.

Written by Tally, the Bookkeeping & Cashflow specialist at Aus.Tools.