GST compliance guide for small businesses in Australia

Understanding GST registration requirements

One of the first things to consider is whether your business needs to register for GST. The ATO requires businesses to register if their annual turnover exceeds $75,000. Not-for-profit organisations have a higher threshold of $150,000. Regardless of turnover, Taxi and rideshare drivers must also register for GST.

If your business is approaching the $75,000 turnover threshold, monitoring your income closely is important. The ATO requires businesses that exceed this threshold to register within 21 days. If you expect to surpass the limit soon, it's wise to voluntarily register to avoid non-compliance issues.

Before you can register for GST, you'll need to have an Australian Business Number (ABN), which can be obtained through the Australian Business Register. Many businesses choose to apply for their ABN and register for GST at the same time.

Correctly classifying GST transactions

Once registered, understanding how to correctly classify your sales and expenses is key to accurate reporting. The ATO outlines four key transaction categories:

• Taxable Supplies: These attract the standard 10% GST and require you to charge GST to customers and include it in your BAS.
• GST-Free Supplies: No GST is charged on these sales, but you can still claim GST credits on related business expenses.
• Input-Taxed Supplies: These are transactions where no GST is charged, and you cannot claim GST credits on purchases related to these sales.
• Out-of-Scope Transactions: These transactions, such as government fees, fall outside the GST system and should not be included in your GST calculations.

Properly classifying transactions ensures you don't overpay GST or miss claiming credits owed to you.

Documentation and record-keeping

Keeping accurate records is a core requirement of GST compliance. The ATO requires businesses to issue tax invoices for sales greater than $82.50 (including GST). These invoices must include:

• Your business name and ABN
• The date of issue
• A brief description of the items sold
• The GST amount or a statement that the price includes GST

In addition to issuing invoices, businesses must retain all GST-related records for a minimum of five years. Digital accounting tools like Thriday can make this easier by helping you store and organise invoices, receipts, and records efficiently.

Maintaining detailed records also makes it simpler to manage BAS lodgments and address any ATO audits or queries.

Reporting and payment obligations

Once registered for GST, businesses must lodge a Business Activity Statement (BAS) outlining GST collected from sales and GST credits claimed on purchases. The frequency of BAS lodgments depends on your turnover:

• Businesses with turnover under $20 million generally lodge quarterly BAS statements.
• Larger businesses may need to report monthly.

When preparing your BAS, ensure you’ve correctly calculated the net GST position — the difference between GST collected and GST credits claimed. Any GST owed must be paid to the ATO by the BAS due date to avoid penalties or interest charges.

How Thriday simplifies GST compliance

Thriday offers an innovative solution that simplifies the entire process for small businesses looking to streamline their GST management.

Thriday combines banking, bookkeeping, and BAS preparation into one automated platform. By integrating your transactions directly into the system, Thriday automatically classifies expenses, calculates GST, and ensures your BAS is ready to lodge - without manual data entry or complicated spreadsheets.

With Thriday, business owners can:

• Instantly track GST obligations in real time with automated transaction categorisation.
• Avoid common GST mistakes with built-in accuracy checks and simplified reporting.
• Lodge BAS directly from the platform, saving time and reducing the risk of errors.

By automating these critical financial processes, Thriday allows small business owners to focus on growth rather than administrative headaches.

Common GST errors and corrections

Mistakes can happen, but addressing errors quickly reduces the risk of fines. Common GST mistakes include:

• Incorrectly reporting GST on sales,
• Failing to account for GST adjustments
• or accidentally claiming GST credits twice

The ATO allows businesses to correct minor GST errors (generally under $10,000) in their next BAS. For larger errors, businesses may need to submit an amendment to the original BAS.

The sooner you address mistakes, the easier it is to avoid compounding compliance issues.

GST compliance checklist

To help you stay on top of your GST obligations, follow this checklist:

✅ Determine if your turnover meets the GST registration threshold

✅ Register for GST within 21 days of exceeding the threshold

✅ Classify all sales and purchases correctly (taxable, GST-free, etc.)

✅ Ensure tax invoices are issued for sales over $82.50

✅ Maintain GST records for five years

✅ Lodge BAS on time and pay any GST owed

✅ Reconcile GST transactions regularly

✅ Use digital accounting tools like Thriday to streamline compliance

✅ Correct any GST errors promptly in your next BAS or via an amendment

✅ Seek professional advice if unsure about GST obligations

By understanding the GST rules, implementing best practices, and following this checklist, your business can confidently manage GST compliance while reducing the risk of costly mistakes. For further guidance, visit the ATO website or consult with a Thriday tax agent.

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