This Information is now Archived (1 March 2002) - some links may not work

Tax reform is a major business issue. You are not exempt - every entity will be a part of the GST system.

GST was introduced on 1 July 2000.
Risks of GST non-compliance include not being able to identify all input credits, which will result in higher than necessary business costs and potential penalties from the ATO for tax on outputs not levied correctly.

Some basic facts about GST:

• Unless your entity is very small, you will need to have registered and
  have an Australian Business Number. The registration threshold is $50,000 ($100,000 for non-profit organisations). However, if an organisation elects not to register it will be unable to recover GST paid on inputs.
  
  
• You will need to clarify whether the services you provide are GST-free, GST-liable or input-taxed. Most hospital services are GST-free. If services are GST-liable, you will have to charge 10 per cent to the consumer and remit it to the Tax Office.
  
  
• You will pay GST of 10 per cent on purchases of goods and services, and in most cases, get a refund ("claim an input tax credit") from the Tax Office. It is very important that you claim ALL the input tax credits to which you are entitled otherwise your business costs will increase. You will need tax invoices showing how much GST you have paid in order to claim your input tax credits. You will need to issue tax invoices when you charge GST on your sales.
  
  
• You need to obtain information about how the GST Act works - from DHS training, from ATO training, from websites, from the media.
  
  
• Not everything about how the GST will work has been decided yet - you will need to follow developments by watching the media, and the internet.
  
  
• With the introduction of GST, the prices of many goods may fall (after claiming an input tax credit) due to savings made by suppliers from the abolition or modification of various taxes (eg wholesale sales tax, diesel taxes). You may have to bargain with your suppliers when you negotiate new contracts to achieve these savings
  

The onus is on you as a tax payer to understand the legislation and keep up to date on changes in the legislation and other developments and to resolve any issues with the ATO.