GST is payable on most goods imported into Australia. However, if you are a GST registered business or organization and you import goods in carrying on your enterprise, you may be able to claim a GST credit for any GST you pay on the importation. The Australia Customs Service (Customer) collects GST on taxable importations. GST is 10% of the value of a taxable importation. The value of a taxable importation is the sum of:
- the customs value of the goods
- any customs duty payable
- the amount paid or payable to transport the goods to Australia
- the insurance cost for that transport, and
- Any wine equalization tax payable.
Example: Jane Doe imported $100,000 worth of iPhone accessories from America, and was charged the following:
- Customs Duty $20,000
- Freight $1,000
- Insurance $800
So the total cost of payment on the importation of the goods for Jane Doe would be:
- Customs duty: $20,000
- Freight: $1,000
- Insurance: $800
- iPhone accessories: $100,000
- Subtotal: $121,80
- GST on purchases: $12,180
- Total purchases: $133,980
If I have to pay GST on my imported goods, how and where do I pay for them? Generally, the GST on the goods is paid to the Customs before the goods are released from the Customs. The good news is, some imported goods are GST free, and they are:
- goods that are GST free or input-taxed within Australia
- goods that qualify for certain customs duty concessions, which includes but are not limited to the following:
- goods imported by overseas travelers not in excess of the duty free allowance, which are the amount of goods you are allowed to carried onboard onto a plane or ship in hand luggage, including tobacco and alcohol
- goods returned to Australia in an unaltered condition
- goods returned after repair or replacement under warranty
- global product safety recall goods
- goods imported for repair or industrial processing, then exported
- certain bequeathed goods (passed on goods in will), including goods donated by person, company or organization established outside Australia to a company established inside Australia for performing humanitarian natured work
- trophies, medals etc
- low value goods which has a customs duty and taxes of $50 or less and has a customs value of less than $1,000
Some examples for the above GST free goods are:
- 275 litres of alcohol carried onboard a plane
- Frozen vegetables
- Returned plasma television bought on eBay Australia
When can I claim the GST back? You can claim GST credits if all the following three rules apply:
- you imported the goods solely to carry on your business
- the importation is a taxable importation, that means, it’s not a tax-free importation as discussed above, and
- You are registered for GST.
You can only claim the GST credits after you paid the GST for the goods to the customs as discussed above, and then claim the GST credits in your BAS. You claim the GST in the quarter or period that you paid the GST on importation. You will need evidence of importation before you can claim a GST credit, otherwise you cannot claim GST credit on the importation of the goods.
