The $75,000 GST Question: When Australian Sole Traders Must Register

There is a line in the Australian tax system that changes everything about how you run your business — and plenty of sole traders cross it without realising. That line is $75,000 of GST turnover, and once you pass it, registering for GST is not optional.

What counts as GST turnover

GST turnover is not your profit, not your income after expenses — it is your gross income from business activities connected with Australia, excluding GST itself, input-taxed sales and some other amounts. It is measured on a rolling 12-month basis: the current month plus the previous 11 months, or the current month plus the projected next 11 months. That second version is the one that catches people out — you can hit the threshold on the strength of a big contract you are about to sign, before a dollar of it lands.

The 21-day rule

Once you cross the threshold — or become aware you will — you must register for GST within 21 days. Not at the end of the financial year. Not when your accountant gets around to it. Register late and the ATO can backdate your registration and expect you to pay GST on sales you made from the date you should have registered.

Two special cases: taxi and rideshare drivers must register from the first dollar of income, regardless of turnover. And you can choose to register voluntarily below the threshold — worth considering if you mostly sell to GST-registered businesses, since registration lets you claim GST credits on your own purchases.

What changes the day you register

Three things, all at once:

Your prices. From your date of registration, you must charge 10% GST on your taxable sales. Your invoices change too — registered businesses issue tax invoices showing the GST amount, while unregistered businesses must not include GST in their prices or call their invoices tax invoices.

Your costs. Registration is not all pain. You can claim GST credits for the GST included in business purchases — effectively getting 10% back on supplies, equipment, and expenses. That only works if your suppliers gave you proper tax invoices, which is another reason to keep every receipt.

Your paperwork. You will lodge a Business Activity Statement (BAS) — monthly, quarterly, or annually depending on your turnover — reporting the GST you collected and the credits you claim. The difference gets paid to (or refunded by) the ATO.

The trap: creeping turnover

The $75,000 line is measured on a rolling 12 months, so a strong half-year can push you over even in a normal year. Side income counts toward the same threshold. And remember the projection test — a single big signed contract can put you over before the money arrives. This is why watching your running total matters more than checking once a year.

How to register

Registration is done online through the ATO — via the Business Registration Service or your ATO online account, or your registered tax or BAS agent can do it for you. You will need your ABN first. Your registration takes effect from a date the ATO confirms, and from that date your invoicing must include GST.

How Lemon fits

Lemon tracks your income through the year, so you can see your rolling turnover against the $75,000 line at any point — and your receipt exports give you the purchase records you need to claim GST credits on your BAS. One dashboard answers both GST questions: am I close to the threshold, and what can I claim.

This article is general information, not tax advice. For your specific situation, talk to an accountant or tax agent.

Download Lemon free on the App Store or Google Play — watch your turnover against the $75,000 line in real time so registration never catches you by surprise.