GST on quotes and invoices: a plain-English guide

Do you need to register?

You must register for GST when your GST turnover reaches the registration threshold, which is currently $75,000 a year for most businesses and $150,000 for non-profit organisations. Taxi and ride-sourcing drivers must register regardless of turnover. You can choose to register below the threshold.

If you aren’t registered, you can’t charge GST and you don’t issue tax invoices. See the ATO’s registering for GST page.

How GST works on a price

GST is 10% of the price before tax. A $1,000 job plus GST is $1,100. To find the GST in a GST-inclusive price, divide by 11: $1,100 ÷ 11 = $100.

Some supplies are GST-free (for example, many basic foods and some health and education services) and some are input-taxed. Check the ATO guidance if any of your products or services might fall into those groups.

Showing GST on a quote

A quote isn’t a tax invoice, but it should be clear about GST:

• State whether prices include or exclude GST.
• Show the GST amount and the total.
• When quoting or advertising to consumers, show the total price including GST. The ACCC expects prices to consumers to show the total price.
• Mark any GST-free lines clearly.

What a tax invoice must include

If you are registered for GST, a tax invoice must include:

1. That it is a tax invoice
2. Your identity (business name)
3. Your ABN
4. The date it was issued
5. A brief description of what was sold, including quantity and price
6. The GST amount, if any
7. The extent to which each item is taxable

For sales of $1,000 or more, the invoice must also show the buyer’s identity or ABN. A GST-registered customer can ask for a tax invoice for a taxable sale over $82.50 including GST, and you need to provide it within 28 days. The ATO’s tax invoices page has the full rules.

Rounding and discounts

Calculate GST on each line or on the invoice total consistently, and round to the nearest cent. Apply discounts before GST so the tax is worked out on the discounted price.

Worked example: a quote with mixed items

A consumer should see the $1,089.00 total clearly. A business customer will usually want the GST amount too, so they can claim it as a credit.

Recipient-created tax invoices and other edge cases

A few situations work differently and are worth checking with the ATO or your accountant if they apply to you: recipient-created tax invoices (where the buyer issues the invoice), sales to overseas customers, sales of second-hand goods, and businesses that use cash accounting for GST. None of these change the basic 10% rule, but they change the paperwork.

Keeping records for the ATO

Keep copies of tax invoices you issue and receive, generally for five years. Store them so they can be found by customer and date. Many businesses keep invoices in their accounting software and link the related quote and customer record in their CRM.

Keeping it consistent

Setting up your products and services with the right tax code once means every quote and invoice gets it right. NovaSoft One stores GST codes on catalogue items and calculates tax on quotes, and the invoice register keeps track of issued invoices and payments. Your accounting software remains the place for BAS and tax reporting.

Common questions

This guide is general information for Australian businesses, not legal, tax or financial advice. Check anything specific to your situation with a qualified adviser or the relevant government agency.