GST threshold for sole traders: when you must register

What is the GST registration threshold?

For most businesses, you must register for GST with the Australian Taxation Office (ATO) when your gst turnover is $75,000 or more in a 12-month period. GST turnover is broadly your gross business income from taxable sales — not your profit after expenses.

If you are close to the threshold, monitor turnover monthly. Many freelancers cross $75,000 part-way through a financial year and must register from the date they become required (not always 1 July).

GST turnover vs taxable income

Income tax is calculated on taxable income (gross income minus allowable deductions). GST is calculated on sales to customers. You might earn $90,000 in turnover but only $60,000 in taxable profit after expenses — you can still need to be GST-registered because turnover exceeded $75,000.

Our Australian sole trader tax calculator focuses on income tax and Medicare; it can flag when turnover may trigger GST registration, but registration rules have exceptions (e.g. some NDIS supplies, GST-free sales).

What changes once you are registered?

• Charge GST — Usually 10% on taxable sales (display “GST inclusive” or add GST on top, depending on your pricing).
• Business Activity Statements (BAS) — Typically lodge quarterly (some businesses lodge monthly).
• GST credits — Claim GST paid on business purchases (software, equipment, some subscriptions) against GST collected.
• Record-keeping — Tax invoices for sales and purchases above certain amounts.

Voluntary registration below $75,000

You may register voluntarily if turnover is under $75,000. This can make sense if you have large GST credits on equipment (e.g. a new laptop or camera) and want to claim them early. The downside: you must charge GST on sales and complete BAS obligations even when small.

Common sole trader scenarios

Side hustle under $75,000

If total business turnover stays under the threshold and you do not choose to register, you generally do not charge GST. Keep records anyway — growth can push you over quickly.

Crossing the threshold mid-year

When you expect to exceed $75,000 in the next 12 months, register within 21 days. Backdate and BAS obligations can apply from the required registration date.

Already registered as an employee

Your salary from an employer is not “business turnover” for your sole trader ABN activity. GST registration relates to your business income, not PAYG wages.

Planning cash flow for BAS

GST you collect belongs to the ATO until lodged. Many sole traders set aside GST collected in a separate bank account each month so quarterly BAS payments do not surprise them. Pair this with PAYG instalments for income tax — both are “pay as you go” obligations.