General > General Technical Chat
GST on imported electronics
VK3DRB:
Hi.
I ordered some electronics parts costing $70.90 for testing and evaluation from Digikey. It is only recently Digikey has asked when you order electronic parts, "Are these goods to be on-sold to someone else?" I was not charged the $7.09 GST (ie: 10%) as these were not originally intended to be on-sold. However later on I did charge the client, so I needed to pay GST. I contacted Digikey who subsequently charged me the GST. Fine, no problem.
My understanding is if I import electronic goods under $1000 for the business, I don't need pay GST; but if I on-sell the goods, GST is payable. (So, what happens if I on-sell half of the goods, eh?) But if I am a consumer, GST is payable in all cases. So if I import a $900 oscilloscope it can be completely GST free if it is used solely for the business. If it is used for both business and personal use, that would complicate things.
I did ask the Australian Taxation Office for clarification on this GST. The bloke at the ATO seems confused about the GST. He literally said if the foreign company does not have an office or registered business in Australia, GST is not payable. I believe he is wrong... Wrong... WRONG!
Maybe other Aussies here know more than the ATO and I on GST when importing electronics for a business. Am I right, or is this bloke from the ATO right?
Admittedly, Australia has the reputedly the world's most complex taxation system thanks to successive bureaucratic governments making a bigger mess whenever they try to simplify things. As they say, you can't have your cake and eat it too! This famous interview about the GST on a birthday cake was the nail in the coffin regarding the interviewee's hope as becoming Prime Minister...
johnboxall:
If you import items for any purpose under A$1000, no extra fees. If it's over AU$1000, you pay the fees, duty, etc.
You sell anything to a customer in Australia - you charge them GST and pay that to the ATO.
However - The ATO has started requiring foreign companies and marketplaces who sell to Australia to voluntarily collect and remit GST. Some businesses abroad are doing this now. For example, if you buy something from Aliexpress, they're now charging GST. As a business with an ABN you can claim that GST back as an input tax credit.
jeremy:
For digikey, I just always pay them GST and then claim it back. If it’s over $1000 you get hit for it (plus about $80 for clearance) by the logistics carrier. Digikey use DAP incoterms.
Mouser is different though, they ship their packages with DDP incoterms. So you only ever pay GST to mouser and then they cover the duties/taxes (even over $1000). Worth keeping in mind if you are ever doing a big order. I personally always try to do my big orders through mouser so I don’t have to deal with the courier nonsense (or directly pay the clearance fee). Never had a problem with the mouser/DHL combo in this regard.
Note: I have no idea if this applies outside Australia.
Ed.Kloonk:
--- Quote from: VK3DRB on October 29, 2021, 07:13:45 am ---
I did ask the Australian Taxation Office for clarification on this GST. The bloke at the ATO seems confused about the GST. He literally said if the foreign company does not have an office or registered business in Australia, GST is not payable. I believe he is wrong... Wrong... WRONG!
--- End quote ---
You need to get a ruling. It has to be in writing from the tax office. Phone calls to/from the tax office won't cut it if they go though you.
Someone:
You seem to have it back to front
--- Quote from: VK3DRB on October 29, 2021, 07:13:45 am ---My understanding is if I import electronic goods under $1000 for the business, I don't need pay GST; but if I on-sell the goods, GST is payable. (So, what happens if I on-sell half of the goods, eh?) But if I am a consumer, GST is payable in all cases. So if I import a $900 oscilloscope it can be completely GST free if it is used solely for the business. If it is used for both business and personal use, that would complicate things.
--- End quote ---
Regardless of where you obtained the goods you need to collect GST on a sale (unless in a GST exempt situation....). A scope bought for a business is not GST free, any GST paid becomes a credit:
https://www.ato.gov.au/business/gst/claiming-gst-credits/
The $1000 threshold for low value imports applies in fewer and fewer situations since 2018 when the government required offshore businesses and platforms to start collecting GST.
Since you don't seem to understand the basics its likely you are an individual and not registered for GST (you're in a world of hurt if you are registered and cant do these basics) which makes it a GST exempt sale so you can't and must not collect GST on sales.
https://www.ato.gov.au/Business/Starting-your-own-business/Before-you-get-started/Are-you-in-business-/
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