GST Calculator Australia 2025: How to Add and Remove GST (With Examples)

What Is GST in Australia?

The Goods and Services Tax (GST) is a broad-based tax of 10% on most goods, services, and other items sold or consumed in Australia. It was introduced on 1 July 2000 under the Howard Government, replacing a range of wholesale sales taxes and state taxes.

Unlike income tax — which is paid directly by individuals — GST is a consumption tax. Businesses collect it on behalf of the government from their customers and then pass it on to the ATO through their Business Activity Statement (BAS). If you are a consumer, you are effectively paying GST every time you buy a taxable product or service.

Understanding how GST works is essential for two groups of Australians: business owners who must register, collect, and remit GST correctly, and consumers and investors who need to understand GST for property purchases, investment decisions, and tax deductions.

How to Add 10% GST to a Price

Adding GST to a GST-exclusive price is straightforward: multiply the price by 1.1.

The Formula

GST-inclusive price = GST-exclusive price × 1.10

Worked Examples

How to Remove GST From a GST-Inclusive Price (The 1/11 Rule)

If you have a GST-inclusive amount and need to find the GST component or the pre-GST price, you use what's known as the 1/11 rule. This is one of the most commonly misunderstood aspects of GST.

A common mistake is to calculate 10% of the GST-inclusive price. This gives the wrong answer. Here is why:

The Wrong Way

If you charge $110 including GST and calculate 10% of $110, you get $11 — which is incorrect. The GST component is only $10.

The Correct Formula — The 1/11 Rule

GST amount = GST-inclusive price ÷ 11

GST-exclusive price = GST-inclusive price × 10/11 (or ÷ 1.1)

Worked Examples Using the 1/11 Rule

When Do You Need to Register for and Charge GST?

Not every Australian business needs to register for GST. The registration threshold is a critical concept for small business owners and sole traders.

The GST Registration Threshold

You must register for GST if your current or projected GST turnover is $75,000 or more per year (or $150,000 for non-profit organisations). Once registered, you must:

• Include GST in the prices you charge customers
• Issue tax invoices for sales over $82.50 (including GST)
• Lodge a Business Activity Statement (BAS) — monthly, quarterly, or annually
• Remit the GST you have collected to the ATO

Voluntary Registration

If your turnover is under $75,000, you can choose to register voluntarily. This can be advantageous if you have significant business expenses — registration allows you to claim input tax credits (GST refunds) on those purchases. However, it also adds administrative obligations, so weigh this up carefully for your situation.

Taxi, Rideshare, and Uber Drivers

A special rule applies to taxi and rideshare drivers (including Uber, DiDi, and Ola): you must register for GST regardless of your turnover, even if you earn less than $75,000 per year from rideshare activities.

What Is GST-Free? What Is Input-Taxed?

Not all goods and services attract GST. There are two important categories to understand:

GST-Free Supplies

These are supplies on which no GST is charged, but the supplier can still claim input tax credits on their related business expenses. Common GST-free supplies include:

• Basic food: Bread, fruit, vegetables, meat, milk, cheese, eggs (but not restaurant meals or snack foods)
• Medical services and health products: Doctor consultations, hospital services, medicines on the Pharmaceutical Benefits Scheme
• Education: School fees, TAFE and university tuition, childcare
• Exports: Goods sold to overseas customers
• Residential rent: Long-term residential rent (note: short-term accommodation like Airbnb is taxable)
• Financial services: Arranging a loan, bank interest (though there are nuances)

Input-Taxed Supplies

Input-taxed supplies are different from GST-free supplies. With input-taxed supplies, no GST is charged to the customer, but the supplier also cannot claim input tax credits on related purchases. The main categories are:

• Financial supplies (bank interest, dividends, insurance)
• Residential rental income from long-term tenants
• Selling or buying an existing residential property (as opposed to new residential property, which is taxable)

Business Activity Statement (BAS) Explained

The Business Activity Statement is the form you lodge with the ATO to report and pay GST, as well as other tax obligations like PAYG withholding and PAYG instalments.

BAS Lodgement Frequency

Key BAS Fields for GST

How the Net GST is Calculated

Net GST payable = GST on sales (1A) minus GST credits on purchases (1B)

If your credits exceed your collected GST (common in early-stage businesses), the ATO will refund the difference.

Common GST Mistakes to Avoid

After years of supporting Australian businesses, the most common GST errors we see are:

1. Calculating GST at 10% of a GST-inclusive price — Always use the 1/11 rule when working backwards from an inclusive price.
2. Not keeping tax invoices — You cannot claim an input tax credit without a valid tax invoice for purchases over $82.50.
3. Charging GST when not registered — You cannot charge customers GST until you are registered. Doing so without registration is illegal.
4. Forgetting to register when turnover hits $75,000 — You must register within 21 days of becoming aware you will exceed the threshold.
5. Mixing up GST-free and input-taxed supplies — The rules differ for claiming credits on purchases related to each type.
6. Not lodging BAS on time — Failure to lodge on time attracts a Failure to Lodge (FTL) penalty of $313 per 28-day period (for small businesses), up to $1,565.