• GST registration

    If your not-for-profit (NFP) organisation has a GST turnover of $150,000 or more (or $75,000 for organisations that are not NFP), it must register for GST. In most circumstances, your organisation can also claim a credit for the GST included in the price of goods and services it buys in carrying on its activities.

    What is goods and services tax?

    Goods and services tax (GST) is a broad-based tax of 10% on the sale of most goods, services and anything else consumed in Australia.

    GST is a tax on transactions. Where an NFP organisation is registered (or required to be registered) for GST, the price of most sales of goods, services and anything else will be inclusive of GST. Similarly, the organisation may be entitled to claim GST credits on the purchases it makes in carrying out its activities.

    Registering for GST

    Your NFP organisation must register for GST if it has a GST turnover of $150,000 or more (or $75,000 for organisations that are not NFP).

    If your organisation has a GST turnover of less than $150,000, it can choose to register for GST. The decision to voluntarily register for GST should be made based on the administrative needs of your organisation.

    Generally, an organisation that registers for GST must then stay registered for at least 12 months, even if its GST turnover is less than $150,000.

    Calculating GST turnover

    An organisation's GST turnover is its gross income, excluding all of the following:

    • GST included in sales
    • input taxed sales
    • sales not connected with an enterprise that your organisation carries on
    • sales not connected with Australia.

    If your organisation is not registered for GST, you will need to look at its GST turnover each month to make sure the GST turnover is not going to be $150,000 or more. Your organisation's GST turnover is $150,000 or more if either of the following applies:

    • its turnover for the current month and the previous 11 months is $150,000 or more – and we are not satisfied that its turnover for the current month and the next 11 months is likely to be less than $150,000
    • its turnover for the current month and the next 11 months is likely to be $150,000 or more.

    Generally, if your organisation's GST turnover is $150,000 or more, it must register for GST within 21 days of the GST turnover meeting the $150,000 GST registration threshold.

    How to register

    Register for GST or other taxes when you apply for an ABN.

    If your organisation already has an ABN:

    Consequences of registering for GST

    If your organisation is registered (or required to be registered) for GST, it generally includes GST in the price of most goods and services and anything else it sells. These sales are called taxable sales, see Taxable sales.

    There are other types of sales where your organisation does not include GST in the price. These are called GST-free sales and input taxed sales, see GST-free sales and Input taxed sales.

    Being registered for GST means that your organisation:

    • must pay the GST it has collected from its sales to us
    • can claim GST credits for any GST included in the price of its business purchases
    • must complete an activity statement to report its taxable sales and claim GST credits.

    See also:

    Taxable sales

    If your organisation makes a taxable sale, the price includes GST. Your organisation makes a taxable sale if it is registered (or required to be registered) for GST and:

    • you make the sale for payment
    • you make the sale as part of the organisation's activities
    • the sale is connected with Australia
    • the sale is not GST-free or input taxed.

    The GST included in the price of a taxable sale is equal to 1/11th of the sale price.

    Your organisation can claim GST credits for the GST included in the price of purchases it uses to make a taxable sale.

    GST-free sales

    If your organisation makes a GST-free sale, it does not include GST in the price. GST-free sales include:

    • basic food items – such as fruit and vegetables, meat, bread and plain milk
    • some education, child care and health services
    • some exports.

    Your organisation can claim GST credits for the GST included in the price of purchases it uses to make a GST-free sale.

    Input taxed sales

    If your organisation makes an input taxed sale, it does not include GST in the price. Input taxed sales include:

    • the sale of residential property (unless it is new)
    • leasing of residential property
    • financial transactions, such as providing a loan.

    Your organisation cannot claim GST credits for the GST included in the price of purchases it uses to make an input taxed sale.

    Collecting and claiming GST on different types of sales

    It is important to understand which type of sales your organisation makes because this affects whether your organisation collects GST on the sale or if it can claim GST credits on the purchase – see the table below.

    Collecting and claiming GST on different types of sales

    Type of sale

    Do you collect GST on your sales?

    Can you claim GST credits on your purchases?

    Taxable

    Yes

    Yes

    GST-free

    No

    Yes

    Input taxed

    No

    No

    Consequences of not registering for GST

    If your organisation is not registered and is not required to be registered for GST:

    • GST is not included in the price of its sales
    • it cannot claim GST credits for the GST included in the price of purchases it makes in carrying on its activities.

    Cancelling your GST registration

    You may cancel your not-for-profit organisation's GST registration if your organisation meets all of the following requirements:

    • has been registered for at least 12 months
    • has a GST turnover of below $150,000
    • has applied for cancellation of the registration.

    Under certain circumstances, your organisation's GST registration may be cancelled if the registration has been in place for less than 12 months.

    Where your organisation has purchased a business asset on which you have claimed a GST credit, you may need to repay some or all the credit on cancellation of your GST registration.

    See also:

    Last modified: 20 Jul 2015QC 16958