Hi there, I am building a Store and will be Launching it in few days. I have some questions regarding the GST in Australia. Do i have to get a ABN number ? As per Australia Tax Office, "Until your business exceeds an annual minimum turnover of AUD $75,000, you are not required to register for GST" . But Shopify says " If your store is based in Australia, then Australian goods and services tax (GST) applies to your Shopify subscription at a rate of 10%. "
Here is my question, The 10% GST is applied on all my items that i sell on the store or Is it just for the Monthly subscription service ? Also is this 10% GST comes in to play if i print the shipping label using shopify ?
Also is there a price guide for the shipping labels with Australia post ? Does shopify have tie ups with any other postal services in Australia ?
Please advise. Thank you.
Nick here from Shopify. Great question, taxes are an integral part of every business.
You don't necessarily have to get an ABN number or register your business to be able to sell on Shopify but for tax and legal reasons, it's something I would highly recommend.
To answer your question, it means that GST is applied to your products when you are selling to customers. Shopify has a helpful guide which goes into detail about setting your taxes for countries outside of the US and Canada which you can see here and specifically about having the taxes being included to the product prices here. Sufio who create apps in the Shopify app store put together a robust blog as a GST guide for Shopify stores in Australia which I think you might find useful. You can read it here. One thing I will recommend is to visit your local tax office or a professional accountant about this. An accountant would know information about this much better for your region as that's where they are based, whereas because I don't live in Australia, I wouldn't be as familiar with Australia tax laws.
Regarding shipping label costs with Australia post, this is something you would need to talk to Australia post about directly. There is an Australia post app in the Shopify App store which has a great rating and seems like it could be what you're looking for. You would need an Australia post account to go along with it though. You can see the app here.
I hope this helps and answers your questions!
All the best, Nick
I am getting different answers here. So you are saying when i sell a 20$ item on Shopify, then shopify payments will take 10% ($2 ) as GST ? or is it just on the Monthly subscription service ?
Please see this link below, Another user asked similar question and he got different answers. Please confirm.
Apologies for the delay in getting back to you about this.
The first thing. I will say is to visit your local tax office or accountant about tax details. I am now 100% on the law, but did some digging on this and found out the following:
Until your business exceeds an annual minimum turnover of AUD $75,000, you are not required to register for GST. In this case, you do not charge GST to your customers. This appears to be a local or regionalized tax from the Australian government based on your business. You can see this third party article going through all the information about Australian taxes and GST here. You can also see the guide Shopify has for setting up your taxes here.
When you say "on the monthly subscription ?" do you mean, are you charged tax on your monthly Shopify plan? I'm not 100% sure what you meant with this. I hope the above articles help explain the other aspects of your questions.
On the shopify website it states "Shopify does not collect GST on your payments if you register for Australian GST and add your Australian Business Number (ABN) to your Shopify store" however it also says "Since you indicated you aren’t GST registered, we’re required to charge 10% GST on your Shopify bills." Does this mean you charge 10% on my monthly fee to shopify which is $29.99 so 10% of that is $2.99 OR does it mean you are charging me 10% GST on every sale I make?
In an instance like this where you're not registered for GST then you will be charged 10% on your Shopify invoices as well as 10% on your Shopify Payments credit card fees, but not on any sales you make.