What is the GST?

Goods and Services Tax (GST) is a broad-based tax of 10% on most goods, services and other items sold or consumed in Australia.

Is registering for the GST compulsory?

All businesses with an annual turnover of $50,000 or more must register for GST and will need an ABN to do this. Organisations with a lower annual turnover may choose to register for the GST and can still apply for an ABN. Applying for an ABN is not compulsory. However, if you are required to register for GST, you will need to apply for an ABN as well.

Why might my enterprise need an ABN?

You need an ABN and GST registration in order to claim GST credits for any GST you have paid for goods and/or services you have used in your business. If you are supplying goods or services, you will need to be able to quote an ABN so that others businesses do not withhold tax at the top marginal rate when they pay you.

How does the ABN affect relations between businesses?

Businesses registered for GST are required to issue tax invoices that quote their ABN. Under Pay As You Go taxation, businesses receiving an invoice are required to withhold tax from their payments for goods and services if an ABN is not quoted. So, if you run a business and issue invoices, then your customers are required to deduct tax at the maximum rate from what they pay you.

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