What is GST?
GST is a tax on most transactions that take place in Australia. The current rate of GST is 10%.
How does GST work?
If you are registered (or are required to be registered) for GST, you must pay GST on all of the supplies that you make. This includes sales to customers for services you provide, as well as the goods that you sell in your business.
Once you register for GST, you are also entitled to claim the GST charged to you on goods and services that you purchase in relation to your business. You can find out more about this when you need to be registered for GST, here.
At the end of each period, the total GST amount that you owe the ATO on supplies is reduced by the total amount of GST credits that you can claim back on purchases. A single payment is then made to the ATO.
Do note, if the amount of GST you are claiming on expenses is more than the amount that you owe on your sales, the ATO will pay you a GST refund.