Most goods, services and other items sold or consumed in Australia will be taxable supplies and therefore where the supplier is registered for Goods and Services Tax (GST), GST at 10% is generally payable. Imports of goods and services are also subject to GST in most instances.
However, exports of goods and services from Australia are generally GST-free, if the specific conditions in the legislation are satisfied. GST-registered entities can still claim GST input tax credits in respect of the GST incurred on the purchase of the goods, which the supplier later exports.
If the other conditions in the GST law are satisfied, exported goods are GST-free when exported from Australia within 60 days of the first of the following two events:
- The supplier receives any payment for the goods; or
- The supplier issues an invoice for the goods.
The 60-day period can be extended by the Australian Taxation Office (ATO), if the supplier requests an extension from the ATO.
If the goods are paid for by instalments, the payment or invoice referred to above, for the final instalment i.e. if the final instalment is paid on 31 March 2019, the supplier has another 60 days from 31 March 2019 to export the goods.
Other exports including sales of things other than goods or real property for consumption outside Australia, services, various rights, financial supplies or other professional services are likely to be GST-free. Broadly, service exports are GST-free if the recipient is outside Australia and the use of the service is outside Australia. However, services supplied in relation to Australian real property are subject to GST even if the customer resides outside Australia.
GST Tourist Refund Scheme (TRS)
Travellers departing Australia can receive a GST refund under the tourist refund scheme (TRS). The scheme applies to goods purchased where the price paid includes GST, from a retailer with the Australian Business Number (ABN), who is registered for GST. TRS does not apply to services. The following conditions must be satisfied to claim a refund under TRS:
- The traveller paid for the goods and has retained the original tax invoice/s for the goods;
- The traveller carries or wears the goods on board the aircraft or ship as cabin baggage unless goods are oversized or subject to aviation security measures and the airline requires them to be checked in as a hold luggage;
- The traveller presents his tax invoices (in English), goods, passport and boarding pass to the TRS facility when departing Australia;
- The traveller makes the claim at the TRS facility at an airport at least 30 minutes prior to the scheduled departure time or 60 minutes if traveling on a cruise; and
- The purchases are from a single business with the same ABN; the total is $300 (GST inclusive) or more and the goods were purchased within 60 days of departure.
How can Nexia Edwards Marshall help you?
For assistance with the application of the GST law in respect of exports, please speak to your Nexia Edwards Marshall NT Adviser.