• GST on livestock and game sales

    Sales of animals are subject to goods and services tax (GST) while sales of meat for human consumption are GST-free:

    • Meat, excluding crustaceans and molluscs, is GST-free when it becomes food fit for human consumption. This happens when an authorised person inspects it and either stamps or passes it as food for human consumption (in accordance with federal, state or territory law).
    • If a carcass is sold before it has been passed as food for human consumption, the sale is subject to GST.

    Sales of livestock or game you make to processors are subject to GST. This is the case even if you make the sale under an arrangement where ownership of the livestock or game passes to the processor only after it becomes food for human consumption.

    For GST purposes, sales you make under such arrangements are subject to GST regardless of when the ownership of the livestock or game changes under the contract or the method used to work out the price of livestock or game you sell (for example, using a weight-based method).

    Abattoirs, wholesalers and butchers purchase livestock or game under various arrangements. These include:

    Sales under direct consignment to a processor

    Livestock or game you sell directly to a processor is subject to GST, regardless of the method you use to work out the sale price.

    Contract or service kills

    There are two types of arrangements for contract or service kills:

    End buyer and processor

    Under this arrangement the end buyer enters into a contract with the processor to slaughter and process the livestock or game that you supply. In this situation the following transactions are subject to GST:

    • the sale of animals you make to the end buyer  
    • the service kill that the processor supplies to the end buyer  
    • the sale of the by-products that the end buyer makes to the processor.

    Flowchart showing the transactions subject to GST

    Producer and processor

    Under this arrangement you enter into a contract with the processor, where:

    • the processor slaughters and processes your livestock or game for a fee 
    • you retain ownership of the meat and by-products after processing  
    • you sell the meat and by-products.

    Sales of meat you make in this arrangement are usually GST-free. However, the service kill the processor supplies to you is subject to GST.

    Flowchart showing the transactions on which GST is payable.

    Auction sales

    If you sell livestock at auction, the sale will be subject to GST if you're registered or required to be registered for GST. The auctioneer needs to advise bidders whether you're registered for GST before bidding begins on your lot.

    You don't include GST in the price of the livestock or game you sell at auction if you're a hobby farmer because, as a hobby farmer, you're not carrying on an enterprise and can't register for GST.

    If you're registered for GST, the auctioneer will need to announce whether the auction price will include GST before the auction begins. If the auction price doesn't include GST, 10% GST must be added to the knock down bid to work out the correct price of the livestock or game you sell.

    Sales to another producer

    If you're registered or required to be registered for GST, sales of livestock and game you make to other producers are subject to GST.

    See also:

      Last modified: 12 Apr 2017QC 16281