Should I Be Registered For GST?
When we start talking about GST do your eyes glaze over and your mind takes you away somewhere else? Yeah, we get it….. but whether your business should be registered for GST or not is a relatively simple question.
Basically, if your annual turnover is $75,000 or greater you must be registered for GST. If it is less than $75,000 then you can voluntarily register if you wish.
There are a couple of exceptions to this general rule. You must register for GST when:
- You start a new business and expect your turnover to exceed the GST threshold within the first year of operation
- If you are already in business and you have reached the GST threshold
- If you are running a non-profit organisation and you have a GST turnover of $150,000 per year or more
- If you are providing a taxi or limousine service for passengers (including ride-sourcing) regardless of your GST turnover – this applies to both owner drivers and if you lease or rent a taxi
- If you intend to claim fuel tax credits for your business
If you voluntarily register for GST then generally, you must stay registered for at least 12 months. If you find you are nearing the $75,000 threshold or it looks like you might exceed it, you must register within 21 days of exceeding it.
How do I register for GST?
You can register through your Registered Tax Agent or BAS Agent, via your ATO Business Portal or by calling the ATO directly. You will need to have an ABN before you can register for GST.
The ATO will notify you in writing of your GST registration details including the date that your registration is effective from.
What happens if I don’t register for GST?
If you don’t register for GST when you are required to do so, the ATO may make you pay GST on sales made since the date you were required to register, even if you didn’t include GST in the price of those sales. You may also have to pay penalties and interest.
Can I backdate my GST registration?
In short, yes you can backdate your GST registration. Although for tax periods commencing on or after 1 July 2012 backdating your GST is limited to 4 years.
How do I work out my GST turnover?
Your GST turnover is your total business income (not profit) minus any of the following:
- The GST included in sales to your customers
- Sales that are not for payment and are not taxable
- Sales that are not connect with the business that you run
- Any input-taxed sales you make
- Sales that are not connected with Australia
Can I cancel my GST registration?
Yes you can cancel your GST registration if your business changes or stops operating.
If you still have questions about whether you should be registered for GST give Dean a call on 0418 566 635 for guidance.