Suitable for: Any sole traders who are currently registered, or think they may need to be registered for GST purposes
Tax Difficulty: Beginner
Airtax Experience: First Timers
Time to Read: 2-3 minutes
Being registered for GST purposes means you need to report your business income and expenses for a given period in a Business Activity Statement (BAS). Based on the outcome of your BAS, you may need to pay the ATO an amount of GST payable (if income is greater than expenses) or the ATO may owe you a refund (if business expenses exceed income).
As a sole trader, it is important to be aware of the conditions in which you are required to be registered for GST purposes, to ensure you don’t fall behind in your reporting obligations. The goal of this article is to clarify exactly when you are required to be registered for GST purposes, and how often you need to lodge a BAS. Airtax provides free ABN and GST registration as part of its service.
When am I required to be registered for GST purposes?
As a sole trader, you are required to be registered for GST purposes if one or more of the following are true:
- Your turnover from your business activity is over $75,000 annually (this does not include salary or any other income earned outside of your ABN), or
- you provide taxi-travel or rideshare services (e.g. Ola, Uber, Didi) for a fee, as part of your business
Quick tip: Lots of our customers ask us about UberEats and Deliveroo. These are not considered rideshare and therefore you only need to be registered for GST if earning over $75,000 annually. You can find out more about this here.
Okay, I need to be GST registered. How often do I need to lodge a BAS?
If you are required to be registered for GST purposes based on either of the above conditions, you need to lodge your BAS on at least a quarterly basis - provided your business turnover is less than $20 million and the ATO has not told you that you must report monthly. You are not able to report BAS on an annual basis if you meet either of the above conditions.
The BAS quarters are as follows:
- July - September (Q1)
- October - December (Q2)
- January - February (Q3)
- April - June (Q4)
Once a BAS period has concluded, you have approximately 4 weeks to lodge your BAS. However if you use Airtax you are typically eligible for an additional 4 weeks, courtesy of the Tax Agent deadline extension. For more info on the exact deadlines, please see here.
You may also elect to report BAS on a monthly basis voluntarily if you wish, however, please note that Airtax charges the same lodgement fee for processing monthly or quarterly BAS.
If you register for GST through Airtax, we will register you on a quarterly basis.
It doesn’t seem like I need to be registered for GST. What do I need to do?
You don’t need to report BAS. However, you will still need to report your business income and expenses in your annual Tax Return - so ensure you still keep adequate records of your business activity. You can do this via Airtax through the income tax service, which includes a custom-built sole trader module.
What you have learned:
- When you are required to be registered for GST purposes as a sole trader.
- The BAS reporting frequency options for you as a GST registered sole trader.
- What the BAS periods are.
- What to do if you’re not required to be GST registered.