Expand into Australia: a quick guide to Goods and Services Tax (GST) 

Australia is rapidly becoming a hotspot for international sellers looking to expand their market reach into global markets outside of the US, UK and EU. With its robust economy, high consumer spending, and growing e-commerce sector, Australia offers a wealth of opportunities for businesses. 

Let’s take a look at why Australia is such a good prospect, and how their Goods and Services Tax (GST) system works overall. 

4 compelling reasons to expand into Australia 

Australia’s e-commerce market is booming, and it’s an excellent time for businesses to tap into this growth. Here’s why:

1. Low seller fees on Amazon: Sellers can benefit from low seller fees ranging from 6-15%, depending on the product category. Also, Amazon FBA fees are competitive, and there are no fees for deals such as Lightning Deals and Deals of the Day. 
2. Growing marketplace: As the Australian marketplace continues to grow, so do sales opportunities. Early movers can establish a strong presence and brand loyalty with less competition than in more saturated markets. The e-commerce market in Australia is projected to grow by 8.28% from 2025 to 2029, reaching a market volume of USD $58.03 billion by 2029. 
3. High consumer spending: Australians have high disposable incomes and a strong tendency to spend on quality products, making it a lucrative market for international sellers. In 2024, household spending in Australia rose by 2.4% compared to 2023, and e-commerce spending reached a record high of AUD $56.07 billion. 
4. Increasing number of online shoppers: In 2024, 17.08 million Australians used online shopping websites monthly, accounting for roughly 63.94% of the country’s population – and this number is expected to grow to 23.14 million by 2029. 

Understanding GST in Australia 

The Goods and Services Tax (GST) in Australia is a 10% tax applied to most goods and services. Understanding how GST works is crucial for businesses looking to sell in this market. Here’s a breakdown of the key aspects of the GST system: 

GST registration: who needs to register? 

Businesses must register for GST if their annual turnover is expected to be AUD $75,000 or more. This threshold includes all B2C sales related to Australia and is calculated over any 12-month rolling period.  

If your turnover is below this threshold, registration is voluntary. However, online marketplace-facilitated sales are not subject to this threshold, as the marketplace will handle GST collection and remittance. 

The 2 types of GST registration 

Simplified GST Registration: Suitable for businesses that breach the $1000 Low Value Imported Goods (LVIG) threshold through distance selling. An Australian Business Number (ABN) is not required, but GST credits cannot be claimed. 

Standard GST Registration: Required for businesses storing goods in Australia. This registration requires an ABN and allows businesses to claim GST credits for taxable importations or purchases. 

What are the benefits of GST registration? 

• Reclaim import GST: Registered businesses can reclaim the import GST in their monthly or quarterly Business Activity Statement (BAS), reducing the total GST due to the sales GST minus the import GST. 

• Assurance of compliance: Ensures compliance with Australian tax laws, avoiding potential penalties and fines. 

How to register for GST 

The registration process involves two main steps: 

1. Register for an ABN: An 11-digit number identifying your business to the government and community.  
2. Register for GST: Once your ABN is live, you can register. AVASK can also help you with this process. 

After registration, businesses must submit a regular BAS to the Australian Tax Office (ATO) and focus on delivering products to customers. Which brings us to…

How do you import goods to Australia? 

The key thing to understand is the AUD $1,000 import value threshold.  

Goods valued at or above $1,000 are subject to import and customs duties, plus GST. These duties are a cost of doing business, but the tax is reclaimable for GST-registered businesses. 

For goods valued below $1,000, the Low Value Imported Goods (LVIG) treatment applies. Since 1 July 2018, these goods have been exempt from customs duties and import GST but are subject to sales GST for sellers exceeding the $75k threshold. 

Ready to expand into Australia?

Expanding into the Australian market presents a significant opportunity. Australia is an attractive destination for international sellers with its growing e-commerce sector, high consumer spending, and favourable seller fees. Understanding and navigating the GST system is crucial for success, and AVASK is here to help you every step of the way.

Start your journey into the Australian market today and unlock new growth potential for your business. 

Questions about GST and selling in Australia