GST & BAS for Small Business in Australia (2026 Guide)

Introduction

GST is the single largest recurring compliance task on an Australian small business calendar — the 10% rate itself is simple, but the A$75,000 threshold, the BAS lodgement cycle, the cash-vs-accruals decision, and a handful of genuine edge cases combine to absorb real time every quarter. This guide covers exactly what an Australian small business owner needs to know in 2026.

Note: This is educational information, not tax advice. GST and BAS rules involve genuine complexity around specific supply types and business structures — confirm your specific situation with a registered tax or BAS agent, or directly via ato.gov.au, before making registration or lodgement decisions.

Table of Contents

1. The A$75,000 Threshold
2. The 21-Day Registration Window
3. ABN Comes First
4. The BAS Lodgement Cycle
5. Cash vs. Accruals — A Choice That Sticks
6. What Counts Toward GST Turnover
7. The Rideshare Exception
8. Input Tax Credits
9. Tax Invoice Requirements
10. Voluntary Registration
11. FAQ
12. Conclusion

The A$75,000 Threshold

You must register for GST once your GST turnover — not total revenue — exceeds A$75,000 in any 12-month period. Not-for-profit organisations get a higher threshold, at A$150,000.

Critically, this is tested two ways simultaneously: your current 12-month turnover, and your projected next-12-month turnover. Reaching the threshold on either test triggers the registration requirement — meaning a single genuinely strong month can obligate you to register even if your trailing 12 months came in comfortably under A$75,000. If your current month's revenue, annualised (multiplied by 12), would exceed the threshold, the ATO expects you to register at that point, not wait for your trailing year to actually catch up.

The 21-Day Registration Window

Once you cross the threshold — or reasonably expect to — you have 21 days to register. This is a genuinely tight window, and importantly, it's on you to notice, not your accountant's annual review cycle: don't wait for a scheduled check-in if you can see the threshold approaching in real time.

Missing this window has real consequences: late registration means the ATO can backdate your GST liability to when you should have registered, and by that point you generally can't retroactively add GST to invoices you've already issued and been paid for — meaning the shortfall comes out of your own margin.

ABN Comes First

GST registration is linked to your Australian Business Number (ABN) — you cannot register for GST without one. If you're operating without an ABN already, securing one is the necessary first step, done through the Australian Business Register (ABR), before GST registration is even possible.

The BAS Lodgement Cycle

Once registered, you lodge a Business Activity Statement (BAS) on a regular cycle:

Quarterly due dates generally fall on the 28th of the month following each quarter's end (with the Q2 due date extended to 28 February to account for the holiday period). A registered tax or BAS agent lodging on your behalf typically secures a further one-month extension on these dates — a genuine, practical benefit of using a registered agent beyond just convenience.

Cash vs. Accruals — A Choice That Sticks

At registration, most small businesses (under A$10 million turnover) can elect either method:

• Cash basis: GST is reported based on when money actually changes hands. A sale invoiced in March but paid in April lands in the April BAS.
• Accruals basis: GST is reported when the invoice is issued or received, regardless of when payment actually happens. That same March sale lands in the March BAS, even if payment arrives later.

This choice matters and doesn't reset easily — changing your accounting basis after the fact requires ATO approval, so it's worth deciding deliberately with your accounting software configured correctly from day one, rather than accepting whatever default gets set up.

What Counts Toward GST Turnover

GST turnover is your gross income from all enterprises you operate, excluding:

• GST already charged (turnover is measured GST-exclusive)
• Input-taxed sales (e.g., residential rental income)
• Supplies not made for payment
• Sales of capital assets
• Sales not connected with an enterprise

Not everything you sell attracts GST — Australian sales fall into three categories: taxable sales (10% GST applies), GST-free sales (basic food, some health and education services — no GST charged, but you can still claim input tax credits on related costs), and input-taxed sales (residential rent, most financial supplies — no GST charged, and generally no input tax credits available either).

The Rideshare Exception

This is a genuine, easy-to-miss edge case: every taxi, limousine, and rideshare driver (Uber, DiDi, Ola, and similar platforms) must register for GST from day one, regardless of turnover — there is no A$75,000 exemption for this category specifically. This catches many part-time rideshare drivers off guard, since the general small-business exemption everyone else relies on simply doesn't apply here.

Input Tax Credits

Once registered, you can generally claim GST credits on most business expenses — but not all:

• Cannot claim: GST on private/personal expenses, most car purchases (only fuel is claimable), or GST-exempt/input-taxed supplies
• Can claim: GST on most legitimate operating costs — equipment, software, commercial rent, professional fees — and for businesses with high operating costs, these credits can meaningfully offset what's owed each quarter, sometimes resulting in a net refund period

Proper tax invoices showing the GST component are required for every claimable expense — a bank statement alone isn't sufficient documentation if the ATO reviews a claim.

Tax Invoice Requirements

For supplies of A$1,000 or more, a tax invoice must identify the buyer (by name or ABN), in addition to the standard requirements (ABN, "Tax Invoice" wording, date, description, GST amount, and whether the amount is GST-inclusive or exclusive). Registered suppliers must provide a tax invoice on request within 28 days. If you're not registered for GST, issue a plain "Invoice" — not a "Tax Invoice" — and state clearly that no GST has been charged.

Voluntary Registration

You can register for GST before reaching A$75,000 if it benefits your specific situation — most commonly when a business has significant GST-free sales or high input costs relative to revenue, since voluntary registration unlocks the ability to claim input tax credits on expenses. The tradeoff: registering also means charging 10% GST on your taxable sales, which can make you more expensive relative to non-registered competitors in a price-sensitive market — worth modelling carefully rather than assuming voluntary registration is automatically beneficial.

Conclusion

The A$75,000 number itself isn't the hard part — it's the surrounding mechanics that catch Australian small businesses out: the dual current/projected test, the tight 21-day registration window, the accounting-basis decision that sticks once made, and edge cases like the rideshare exception that override the general threshold entirely. Building a habit of checking your GST turnover monthly, not just at tax time, is what turns this from a recurring compliance stressor into a routine, predictable part of running the business.

If you'd like help setting up GST-compliant bookkeeping and BAS-ready records from the start, get in touch for a free consultation.