The GST or Goods and Services Tax is something which is important to get right. Getting it wrong is costly, and lack of knowledge on behalf of the Business Owner doesn’t cut it at the Tax Office. Currently, GST is a tax of 10% which is applied to most Goods and Services in Australia. Although recently there has been talk that the GST may increase from 10% to 15% as Prime Minister Malcolm Turnbull has confirmed a GST increase is in his sights as the government prepares its tax reform package.
Currently, it’s mandatory to register for GST if you expect your annual turnover to be $75,000 or more in Sales (not Profit). If you haven’t registered for GST, and you become aware that your GST turnover will exceed the $75 000 per year threshold, you will have to register for GST within 21 days. It’s a good idea to check each month to ensure you’re not likely to pass the threshold. If you don’t you could be liable for 1/11th of your income (plus penalties) if you are audited.
You must register for GST if:
However if your turnover will be less than this, registering for GST is optional, and you should consider the implications of your decision.
Reasons TO register earlier might be –
Reasons NOT to register for GST earlier might be –
Getting GST right is essential for tax compliance and for strategy in terms of planning and decisions in regard to pricing within your business. Remember, sometimes being required to maintain your financial records in a timely manner can provide valuable insight that may assist in the management of your business, so the admin involved in completing your business activity statement (BAS) may be a blessing in disguise.
If you would like a Complimentary GST Review, simply email our team at firstname.lastname@example.org.