Australia GST for Freelancers and Small Business: When You Must Register

Australia's Goods and Services Tax is a flat 10%, which makes the arithmetic simple — the confusing part for freelancers and small businesses is almost always timing: when you're required to register, and how registering changes what you charge and what you can claim back.

The $75,000 threshold

You must register for GST once your business's GST turnover reaches or is expected to reach AUD $75,000 in a 12-month period (the threshold is $150,000 for non-profit organisations). This isn't your profit — it's gross turnover from taxable sales. Once you cross the threshold, you have 21 days to register with the ATO. You can also register voluntarily before reaching it, which some freelancers do specifically to claim GST credits on business expenses.

What changes once you're registered

Registered businesses must add 10% GST to their taxable sales, issue tax invoices showing the GST component separately, lodge Business Activity Statements (BAS) — usually quarterly — and can claim back GST paid on business purchases (input tax credits). Unregistered freelancers below the threshold don't charge GST at all and can't claim it back on expenses either.

Two ways to calculate 10% GST — and why it matters which one you use

Adding GST to a price (GST-exclusive → GST-inclusive): multiply by 1.10. A $500 service becomes $550 including GST.

Extracting GST from a price (GST-inclusive → GST component): divide by 11, not by 10. A $550 GST-inclusive price contains exactly $50 of GST ($550 ÷ 11 = $50) — dividing by 10 instead gives $55, which overstates the GST component and understates your actual sale price. This one-number mistake is common enough that it's worth double-checking on every invoice until it becomes automatic.

A worked invoice example

You quote a client $2,200 for a project, GST-inclusive. Your tax invoice should show: Sale price (ex-GST) $2,000.00, GST (10%) $200.00, Total $2,200.00. The $200 GST component is what you remit to the ATO (minus any GST credits from your own business expenses that quarter) — it was never part of your revenue to begin with, even though it sat in your bank account after the client paid.

Try it yourself

Our Australia GST Calculator handles both directions — adding 10% to a base price or extracting the GST component from a GST-inclusive total — so you can generate correct invoice figures without doing the ÷11 calculation by hand.

This guide is for general understanding, not tax advice. GST registration obligations depend on your specific circumstances — confirm your position with the ATO or a registered tax agent.