Account for GST on goods imported to Australia

Goods and Services Tax (GST) is payable on most goods imported into Australia (taxable importations). GST on taxable importations is payable by businesses whether they are registered for GST or not. However, if you are a GST-registered business and you import goods as part of your activities, you may be able to claim a GST credit for any GST you pay on those goods.

Add localizations

If you will be importing taxable goods to Australia, you should add localizations for Australia that include the required tax codes and report transformations. Instructions for adding localizations can be found in another Guide.

To properly account for GST on imported goods, you must import the localization for Business Activity Statement — Full:

Note
Business Activity Statement — Simpler does not install tax codes for taxable importations. It only covers domestic commerce.

Recording taxable importations

When you purchase goods from an overseas supplier, you will receive the GST bill from Customs. This bill will be completely separate from any bill or sales invoice from your supplier. Since it will be paid to a different entity, it must be recorded as a distinct transaction. When you enter the payment or purchase invoice for the goods, do not select any tax code, because you are not paying any tax to the supplier:

When you pay the GST bill from customs, post the payment to the same account used for the corresponding purchase and select the GST on Imports tax code:

After you have the $5,000 paid to your overseas supplier and $500 in GST to Customs, they will show on your Business Activity Statement — Full report transformation as follows:

Deferring payment of GST on imported goods

If you are an importer and are registered for GST, you may be able to defer payment of GST by participating in the deferred GST scheme. If you have been approved to participate in the deferred GST scheme, use the tax code named GST 10% (Deferred) when recording purchases from overseas subject to GST:

In that case, Customs will not send you a separate bill, and you will make no payment until tax filing time. The deferred GST will be shown in box 7A of the Business Activity Statement — Full, to be combined with other GST you may potentially owe from taxable sales. But it will also be recorded as GST paid on purchases, leaving you with a zero net tax on that particular purchase:

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