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Your community organisation may be required by tax laws to pay goods and services tax (GST) on any goods and services it supplies. We recommend that your organisation seeks advice on its GST obligations. The following information is to help people involved in not-for-profit community organisations to understand basic details of GST and the GST concessions that may be available.
What is GST?
GST is a tax of 10% on the sale (supply) on most goods and services consumed in Australia. In general, an organisation that is required by law to ‘register’ for GST purposes:
- is required to pay GST to the Australian Taxation Office (ATO) if it sells something (goods or services), and
- can claim an ‘input tax credit’ from the ATO for the amount of GST included in the price of goods and services it purchases
Does our community organisation have to ‘register’ for GST purposes?
Whether your community organisation has to register for GST purposes depends on its turnover.
At 2021 the GST registration threshold for not-for-profit organisations is $150,000.
The ATO has particular requirements for working out an organisation’s ‘annual GST turnover’ based on the annual income received from its supplies. For more information on how to calculate your organisation’s annual turnover see the Resources section below.
Our community organisation has an annual turnover under $150,000
If your community organisation is a not-for-profit organisation, and it has an annual turnover of less than $150,000, it doesn't have to be registered for GST purposes (but can voluntarily register if it wants to). In general, this means that, unless registered, the organisation does not include GST in the price of any goods and services it sells, and it is also unable to claim GST credits (input tax credits) for the GST it pays when buying goods or services while carrying on its activities. Before registering voluntarily you need to decide whether the administrative burden of complying with GST reporting obligations outweighs the benefits.
Our community organisation has an annual turnover of $150,000 or more
If your community organisation is a not-for-profit organisation, and it has an annual turnover of $150,000 or more, it must register for GST purposes and your organisation will have GST obligations. In general, when it sells something (goods and services) it may have to pay the GST to the ATO. When it purchases goods and services, it can claim an input tax credit from the ATO for the amount of GST included in the price of those goods and services purchased.
To register your organisation for GST purposes, you will need to have an Australian Business Number (ABN). Once you have an ABN, you can start the process for registration for GST via the Australian Business Register website, or you can call the ATO. Further details are in the Resources section below.
If we register for GST, do we always have to pay GST or are there some concessions?
If your organisation registers for GST purposes, GST is generally payable on supplies your organisation makes but there are a limited number of GST concessions that may be available for certain not-for-profit community organisations. These concessions further require 'registered charity' status with the Australian Charities and Not-for-profits Commission (ACNC) and usually relate to particular activities (such as sales relating to raffles, bingo, fundraising events, sales of second-hand goods or uncommercial transactions and volunteer expenses). There are a number of requirements and differing GST treatment. You should carefully review the ATO’s information on GST concessions and seek advice from an accountant and lawyer.
Which community organisations are eligible for these GST concessions?
If your organisation is registered for GST purposes, there are a number of GST concessions which are available for:
- not-for-profit organisations that are registered with the ACNC and have been endorsed by the ATO for charity tax concessions, and
- not-for-profit organisations that have been endorsed by the ATO as deductible gift recipients (DGRs)
For more information on charity tax concessions, read the ACNC's fact sheet on applying for charity tax concessions.
There are also some limited ‘concessions’ available for not-for-profit community organisations who are not endorsed for charity tax concessions or DGR status. For example, the laws relating to whether related organisations form a GST group (and therefore don’t have to pay GST on transactions between group members) are more generous for not-for-profit organisations than they are for ‘for-profit’ businesses.
For full details of the GST concessions, and the organisations that those concessions may be available to, see the ATO page in the Extra Resources section below.
Australian Charities and Not-for-Profit Commission (ACNC)
Australian Taxation Office (ATO)
- Tax basics for non-profit organisations
This is the ATO's basic guide to tax and it includes a chapter on GST. You should also read the addendum to the guide which is available from the same page as it updates the guide in relation to certain areas of the law (including GST).
- GST concessions
This is the ATO's specific page about GST concessions available for NFP organisations and registered charities.
Registration for GST - via Business Portal
If your organisation has an ABN or an Auskey, you can begin the process for registering for GST purposes, via the ATO Business Portal site. Click on the 'Login' button in the bottom of the site. You will need to enter identifying details for your organisation.
- Factsheet: Charity tax concessions
If your organisation is endorsed for charity tax concessions it will be eligible for GST concessions (and other tax concessions). This ATO page contains information about whether your organisation is eligible to be endorsed for charity tax concessions.
- How to apply for endorsement for charity tax concessions
This is a link to an ATO webpage which explains the application process for charity tax concessions.