Selling goods from a treaty country through an Australian agent

You will have certain tax obligations if both of the following apply:

  • you are a resident entity of a country that has a tax treaty with Australia
  • you export goods to Australia through an agent in Australia.

Under these circumstances, you will have the following tax obligations:

  • Income tax - If you have dependent agents in Australia who have authority to enter into contracts on your behalf and regularly exercise that authority, they may be regarded as your permanent establishment. This means your business profits will be subject to Australian income tax.
  • CGT - If you have a permanent establishment in Australia, the assets you own as part of that permanent establishment will generally be subject to CGT when you sell or otherwise dispose of those assets - refer to Guide to capital gains tax (NAT 4151).
  • GST - If you make sales, purchases or importations through a resident agent, the agent may have GST obligations. GST is a broad-based tax of 10% on most goods, services and other items sold or consumed in Australia - refer to Supplying goods and services in Australia - goods and services tax.
  • ABN - You will need to register for an ABN for certain tax purposes, which may include GST and pay as you go (PAYG) withholding. You generally need to quote an ABN on your invoices or other documents relating to sales you make to other businesses. If you do not quote an ABN when you supply goods or services to another business, they may have to withhold tax from their payment to you at the rate of 46.5% under the PAYG withholding system.
  • Superannuation and PAYG withholding - If you employ a full-time, part-time or casual worker, or a contractor wholly or principally for labour as your agent in Australia, you may have Australian superannuation obligations or PAYG withholding obligations.

Fringe benefits tax (FBT) - If you employ a full-time, part-time or casual worker as your agent in Australia, and you provide benefits to them or their associate (typically family members) in place of, or in addition to, salary or wages, you may have fringe benefits tax (FBT) obligations.

    Last modified: 22 Feb 2011QC 18431