How do I calculate GST in Australia?

To add GST to a price, multiply by 1.1. To find the GST component of a GST-inclusive price, divide by 11 (not by 10%). For example, a $110 invoice includes $10 GST ($110 ÷ 11 = $10), not $11 ($110 × 10% = $11). The 1/11 method is the ATO's official tax fraction and is the correct approach.

What is the GST rate in Australia?

The GST rate in Australia is 10% and has been unchanged since GST was introduced on 1 July 2000. It applies to most goods and services sold or consumed in Australia. Some items are GST-free — including basic food, most health services, and educational courses — and some are input-taxed, such as residential rent and financial services.

Do I need to register for GST in Australia?

You must register for GST if your business has a GST turnover of $75,000 or more per year (or $150,000 for non-profit organisations). Taxi, rideshare, and limousine drivers must register regardless of turnover. Voluntary registration is available for businesses below the threshold and allows you to claim GST credits on business purchases.

What items are GST-free in Australia?

GST-free items include: basic food (fresh fruit and vegetables, meat, bread, milk, eggs), most health services where Medicare benefit is payable, most educational courses, child care, exports, water and sewerage, residential rent (though this is input-taxed rather than GST-free), and some religious and charitable activities. Mixed supplies may have both taxable and GST-free components.

When is my BAS due in Australia?

BAS due dates depend on your lodgement frequency. Quarterly lodgers: the four quarters end 30 September, 31 December, 31 March, and 30 June, with due dates approximately 28 days after each period end. Monthly lodgers: due 21 days after the end of each month. Annual lodgers: due 31 October. Tax agents generally receive a concession of approximately four additional weeks for Q1, Q3, and Q4 quarterly BAS.

Finance & Tax 📅 2026-06-25

GST Calculator Australia: How to Add and Remove GST the Right Way

💰

MegaCalcOnline Finance Team

Australian tax and finance specialists · Updated 2026-06-25

The 1/11 rule versus the 10% rule, what items are GST-free, how to lodge your BAS, and the most common GST mistakes Australian businesses make — all explained with worked examples.

The GST rate and when it applies
How to add and remove GST — the right formulas
GST-free vs input-taxed: what the difference means
When you must register for GST
BAS: how to report and pay GST
The five most common GST calculation mistakes
Frequently asked questions

The GST Rate and When It Applies

Australia's Goods and Services Tax (GST) is a broad-based consumption tax of 10% on most goods and services supplied in Australia. Introduced on 1 July 2000 by the Howard Government, the rate has remained unchanged at 10% for over 25 years.

GST applies at each stage of the supply chain but is ultimately borne by the end consumer. Businesses registered for GST collect GST on their sales (output tax) and claim GST credits on their eligible business purchases (input tax). The difference is what they remit to the ATO through their Business Activity Statement (BAS).

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How to Add and Remove GST — The Right Formulas

There are two common GST calculations, and confusing them is a very frequent error:

Adding GST to a GST-exclusive price

Multiply the price by 1.1 (or equivalently, multiply by 10% and add).

✅ Example: You sell a service for $500 ex-GST. GST to add: $500 × 10% = $50. Total invoice including GST: $550. Or shortcut: $500 × 1.1 = $550.

Removing GST from a GST-inclusive price (the 1/11 method)

Divide the GST-inclusive total by 11 to find the GST component. Do NOT multiply by 10% — this is the most common GST mistake.

✅ Correct example: You received a $220 invoice. GST component = $220 ÷ 11 = $20. Price ex-GST = $200.

❌ Incorrect (common mistake): $220 × 10% = $22 — this is wrong. GST is 10% of the pre-GST price, not 10% of the total price. The 1/11 method is the ATO's official tax fraction.

Why the 1/11 rule, not 10%?

GST is calculated as 10% of the net (ex-GST) price. If you add 10% to $100, you get $110. The $10 GST is 10% of $100, but it is only 9.09% of $110. Dividing by 11 accounts for this: $110 ÷ 11 = $10 exactly. The formula works because in any GST-inclusive price, the GST always represents exactly 1/11th of the total.

Task	Formula	Example	Result
Add GST to net price	Net × 1.1	$500 × 1.1	$550
Find GST in inclusive price	Inclusive ÷ 11	$550 ÷ 11	$50
Find net from inclusive price	Inclusive ÷ 1.1	$550 ÷ 1.1	$500

GST-Free vs Input-Taxed: The Important Difference

Not everything attracts GST, but the two categories of "no GST" are importantly different:

GST-Free Items

GST is charged at 0% — no GST in the price, but the supplier can still claim input tax credits on related business purchases. Examples:

Basic food: fresh fruit, vegetables, meat, bread, milk, eggs (but not hot food, snacks, or restaurant meals)
Health services where a Medicare benefit is payable
Most educational courses and childcare
Exported goods and services
Water, sewerage, and drainage

Input-Taxed Supplies

GST is not charged, AND the supplier cannot claim GST credits on related purchases. This is the important distinction — input-taxed suppliers are more restricted than GST-free suppliers. Examples:

Residential rent (you do not charge tenants GST on rent)
Most financial services (interest, insurance premiums)
Sales of shares and other financial securities

💡 Practical implication for landlords: Because residential rental income is input-taxed, you cannot claim GST credits on costs related to your rental property (repairs, property management fees charged with GST). This is different from commercial property, which is generally a taxable supply and allows full GST credits.

When You Must Register for GST

You are required to register for GST if your GST turnover (not profit) from taxable supplies is:

$75,000 or more per year for most businesses
$150,000 or more per year for non-profit organisations
Any amount if you provide taxi, rideshare (Uber, Ola), or limousine services — regardless of turnover

If you expect to reach the threshold within the next 12 months, you must register immediately — not wait until you actually hit the threshold. Registration is free and done through the ATO via ABN registration or your existing myGov/ATO online services account.

Voluntary registration below the threshold is available and may be advantageous if you have significant business purchases — being registered lets you claim GST credits on those costs, even if your sales are below the threshold.

BAS: How to Report and Pay GST

Once registered for GST, you report and pay it through a Business Activity Statement (BAS). The ATO assigns your filing frequency based on your annual turnover:

Turnover	BAS Frequency	Key Due Dates
Under $20M (most businesses)	Quarterly	28 days after each quarter end; 28 Feb for Q2 (Oct-Dec)
$20M or more	Monthly	21 days after each month end
Under $75k (voluntary registrants)	Annual	31 October

On your BAS, you report: G1 (total sales including GST), 1A (GST collected on sales), and 1B (GST credits claimed on purchases). The net amount (1A minus 1B) is what you either pay to or receive from the ATO.

⚠️ Late BAS penalty: The ATO charges a Failure to Lodge (FTL) penalty of $330 per 28-day period (capped at 5 units = $1,650 for small entities) for late BAS lodgement, plus General Interest Charge (GIC) on unpaid GST. Lodge on time even if you cannot pay immediately.

The Five Most Common GST Calculation Mistakes

Using 10% instead of 1/11 to extract GST: Taking 10% of a GST-inclusive amount overstates the GST by about 10%. Always divide by 11.
Including GST in your income: GST collected belongs to the ATO, not you. Your business income for income tax purposes is the GST-exclusive amount. Including GST in your turnover calculation can also push you into higher tax brackets incorrectly.
Not having a valid tax invoice: To claim GST credits over $82.50, you need a tax invoice showing the supplier's ABN, GST amount, and date. Without it, the ATO can disallow your credit.
Claiming GST on input-taxed supplies: You cannot claim GST credits on costs related to making input-taxed supplies (residential rent). Mixed-use properties require careful apportionment.
Forgetting GST on imports: Goods imported with customs value above $1,000 generally attract GST at the border. Low-value goods ($1,000 or less) from overseas suppliers also attract GST (since 2018), collected by the seller at point of sale for most major international platforms.

Frequently Asked Questions

Do I charge GST on services provided overseas?

Services exported to overseas customers are generally GST-free, provided the services are performed for a non-resident who is not in Australia at the time they receive the service. However, the rules are complex — particularly for digital services to overseas consumers. The ATO's guidance on GST and international services provides detailed guidance for specific scenarios.

Can I claim GST credits on a car for business use?

Yes, but subject to the luxury car limit. GST credits on a car used partly for business are capped at the GST in the car limit ($76,950 for 2025-26), and further reduced by your private use proportion. A car used 60% for business purposes allows a GST credit on 60% of the GST paid (capped at the car limit). Maintain a logbook to substantiate the business use percentage.

What is the GST-inclusive price of a $1,500 item?

$1,500 × 1.1 = $1,650. The $150 GST component can be verified: $1,650 ÷ 11 = $150. The customer pays $1,650; you remit $150 to the ATO and keep $1,500 as your income (before other taxes and costs).

Is my residential rental income subject to GST?

No. Residential rent is an input-taxed supply — you do not charge GST on rent received from residential tenants, and you cannot claim GST credits on costs related to the rental. Commercial property rent is different: commercial landlords generally charge GST on rent and can claim input tax credits on related expenses.

⚠️ General Information Only: This article provides general educational information about Australian finance and taxation. It does not constitute financial, tax, or legal advice. Individual circumstances vary significantly. Always verify current figures at ato.gov.au or consult a registered tax agent or financial adviser before making any financial decision.