Australian GST Registration Guide How to determine if registration is necessary?
Australian GST Registration Guide When to register?
GST is the abbreviation for Goods and Services Tax in Australia. It is a broad tax levied on most goods, services, and other items sold or consumed in Australia at a rate of 10%, which is commonly known as a consumption tax. Like the VAT in the European Union and Middle Eastern countries, GST is a tax on goods and services sold. Non-resident (foreign) companies selling to the Australian market need to consider their GST obligations. If a foreign company meets both of the following two conditions, they must register for GST in Australia: – when the GST turnover of the company (total revenue minus GST) reaches or exceeds AUD 75,000 (GST threshold) (AUD 150,000 for non-profit organizations); – when starting a new business and expecting the turnover to reach the GST threshold in the first year (AUD 150,000 for non-profit organizations). If the GST turnover is below AUD 75,000, a company may voluntarily register for GST. If a company chooses to register, they must usually keep the registration for at least 12 months before cancelling it. It is important to note that if all sales (especially direct mail) of a company are sold to Australian consumers via a third-party sales platform, GST registration is not required as the sales platform will withhold and pay the GST. There are two ways for non-resident (foreign) companies to register for GST in Australia: standard GST and simplified GST registration. Simplified GST registration is suitable for non-resident companies, including merchants, electronic distribution platform (EDP) operators, and freight forwarders who: · do not need an Australian Business Number (ABN); · sell to Australia; · sell imported services and digital products to Australian consumers; · sell low-value imported goods (AUD 1,000 or less) to consumers; · want to quickly and easily register, report and pay electronically; · do not need to apply for GST exemptions (including tax-exempt imports). By registering, they choose to become a limited registration entity and do not have the right to obtain an ABN or claim GST credits. Standard GST registration is suitable for non-resident companies who: · have or need an ABN; · sell to Australia; · want to issue tax invoices; · want to apply for GST exemptions. Standard registration cannot be submitted electronically from outside Australia and requires the hiring of an Australian registered tax agent. The difference between simplified and standard registration: Companies using simplified GST registration will be able to: · sell compliantly in Australia without an ABN; · sell imported services, digital products, or low-value imported goods; · quickly and easily register, report and pay electronically; · not issue tax invoices; · not require proof of identity for registration; · not apply for GST exemptions (including tax-exempt imports). Companies using standard GST registration will be able to: · have or need an ABN; · sell compliantly in Australia; · issue tax invoices; · apply for GST exemptions. If a company does not register, they need to check their GST turnover every month to see if they have reached or may exceed the threshold. They must register within 21 days after their GST turnover exceeds the relevant threshold. If they are required to register but have not done so, they may need to pay GST for sales from the date they are required to register, as well as fines and interest. Understanding the relevant regulations of Australian GST is a necessary step for sellers to enter the Australian market. Compared with the fierce competition in Europe and the United States, there are relatively few Chinese sellers in the Australian market, making it a very promising blue ocean market. Amber Accounting Firm is an Amazon SPN tax service provider and one of the first service providers in China to obtain an Australian GST number, with many successful cases.
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