Talking Cents

What You Need To Know About GST for Your Small Business?

GST are taxes you pay on the goods or services you sell or consume. According to the Australian Taxation Office, the percentage of GST is generally about 10%. This may vary depending on the product or service. Some products or services can be exempted, and others can have a higher tax rate.

Although most people know this, there are certain things about the GST tax that very few people know. For example,

● Who is required to pay the GST to the government.
● Who must pay despite not reaching the threshold.
● Who does GST not apply to.
● What services are entirely exempted from GST, etc.

Let's create a better understanding of GST and its rules in Australia.

1. The Basics Of GST

GST is a tax on all goods and services produced within a country. In the case of Australia, the percentage generally is 10 percent. Most businesses include the GST in the final cost to avoid confusion.

2. The Income Limit for GST Exemption

GST for small businesses depends on their annual turnover. If a business's annual turnover reaches $75,000 or a non-profit's annual turnover is $150,000, they must register for GST.

3. Who pays GST despite lower Income

Although there are tax exemptions for some threshold of annual turnover, some businesses are mandated to pay GST despite their turnover. These are taxi services such as Uber, GoCatch, Didi etc. They might get other tax credits but are required to pay GST.

4. Who is always Exempted

There are certain services or goods that the government does not include in the GST bracket to facilitate the health, education and general well-being of its population. This includes but is not limited to basic food, certain medical and health care services, some childcare facilities, certain menstrual products, among others.

Companies from Australia that provide their goods and services outside of the Australian jurisdiction are also not liable to pay GST. However, they may have to pay taxes if any goods remain in Australia for more than 60 days after they are sold.

Consider M.A.S. Partners for Your Accounting Needs

Most small businesses provide services or products to their local markets. These businesses can benefit significantly from specialised accounting services for their GST and tax management. Contact M.A.S Partners for small business accounting in Sydney. For more information about our small business accounting services, click here.