SEMA eNews Vol. 21, No. 28, July 12, 2018

New Tax Required for U.S. Companies Selling More Than $56,000 USD Annually to Australian Consumers

By Linda Spencer

  Tax
Australian taxation authorities are collecting a new 10% Australian goods and services tax on overseas sales of low-value imported goods —defined as having a customs value of $1,000 (AUD) [approximately $750 USD] or less—by consumers into Australia.
   

On July 1, Australian taxation authorities began collecting a new 10% Australian goods and services tax (GST) on overseas sales of low-value imported goods (LVIG)—defined as having a customs value of $1,000 (AUD) [approximately $750 USD] or less—by consumers into Australia.

What U.S. companies meeting these conditions are required to do:

  • Track their Australian sales to determine whether they are made for Australian consumers and, if so, whether they anticipate that they will exceed $75,000 (AUD) [approximately $56,000 USD] per annum in aggregate. If so, they will need to choose whether to increase prices for GST or absorb the additional cost.
  • Register with the Australian Tax Office (ATO).
  • Pay any GST due.

Businesses/sales NOT covered by this new tax:

  • Those with sales of $75,000 (AUD) or less to consumers in Australia within a 12-month period.
  • Those with sales of low-value imported goods made to Australian GST-registered businesses that purchase for business use.
  • Any individual sales more than $1,000 (AUD). These sales will continue to be taxed at the border.

More information, including how to be sure a distributor/customer is an Australian GST-registered business (not a consumer), is available on the Australian Taxation Office’s website here and here.

For more information, contact Linda Spencer at lindas@sema.org.

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