Does your business buy products and services from overseas suppliers?
If so, you may be charged GST – but not always! Overseas businesses must register for GST in Australia if they have a turnover of more than $75,000 for sales connected with Australia.
Many large online retailers are registered and charge GST, and you can claim this GST on your BAS.
However, many smaller or independent online businesses are not required to be registered for GST in Australia; therefore, they do not need to include it in their invoices. A common error we see is that business owners claim GST on the BAS on all purchases, even overseas purchases that don’t charge GST.
Sometimes the invoices are not clear if GST applies or not. If you’re buying from a new supplier and unsure if GST applies, check their registration at ABN Lookup. If the business has an ABN, the lookup will tell you if it is registered to charge GST. Check their invoice to see if GST has been included. If not, this is a GST free purchase on your BAS. If the business doesn’t have an ABN and isn’t registered for GST, you won’t find them on the ABN Lookup.
When buying business purchases from overseas take note to get BAS reviewed to check GST claims are correct. We’ll also check that your accounting software is set up correctly to make automatic coding of purchases accurate.
Talk to us to organise a review of your business accounts before you finalise your next BAS and tax return.