In the complex symphony of Australian business taxation, GST turnover plays the lead instrument. It's the financial metric that determines whether your business needs to register for Goods and Services Tax (GST) and can significantly impact your compliance obligations. For creative professionals and small business owners in Penrith and across Australia, understanding GST turnover isn't just about ticking a regulatory box—it's about orchestrating your business finances effectively and avoiding potentially costly mistakes.
Whether you're a session musician, a graphic designer with a growing client base, or a production company scaling up operations, knowing your GST turnover position is essential. This comprehensive guide will break down everything you need to know about GST turnover in clear, accessible terms so you can focus on what truly matters—creating great work and running a successful business.
GST turnover is the total gross income your business earns from its activities, excluding specific items like GST collected from customers and input-taxed supplies. Unlike profit, which considers your expenses, GST turnover focuses purely on your income stream—making it a clearer indicator of your business's size and scale.
The Australian Taxation Office (ATO) uses GST turnover as the primary measure to determine whether your business needs to register for GST. As of 2025, the registration threshold remains at $75,000 for businesses and $150,000 for non-profit organisations.
Why does this matter? Because if your GST turnover exceeds these thresholds, you're legally required to register for GST, charge GST on your taxable supplies, and lodge regular Business Activity Statements (BAS). Missing this obligation can result in penalties of up to 75% of the tax shortfall for deliberate non-compliance—hitting your business with an unwanted financial discordant note.
Calculating GST turnover requires understanding both what to include and what to exclude. Think of it like mixing a track—some elements need to be amplified, while others need to be filtered out.
The ATO requires businesses to consider both current and projected turnover:
For creative professionals, this means you need to consider both your recent performance history and your upcoming gigs, contracts, or sales when determining your GST position.
The key GST registration thresholds in Australia as of 2025 are:
It's important to note that these thresholds apply to your GST turnover, not your profit. Even if your expenses are high and your profit margin is slim, you still need to register if your turnover crosses these thresholds.
There are also special rules for:
Businesses must monitor both current and projected turnover regularly. If you cross the threshold:
Here's a comparison of different business scenarios and their GST obligations:
| Business Type | Annual Turnover | GST Registration | BAS Lodgement |
|---|---|---|---|
| Solo musician | $45,000 | Optional | Only if registered |
| Graphic design studio | $85,000 | Mandatory | Quarterly/Monthly |
| Recording studio | $250,000 | Mandatory | Quarterly/Monthly |
| Arts charity | $140,000 | Optional | Only if registered |
| Arts charity | $160,000 | Mandatory | Quarterly/Monthly |
For creative professionals, understanding GST turnover has unique implications. The irregular income patterns common in creative industries can make compliance particularly challenging.
Many creative professionals experience significant fluctuations in income—recording an album might bring a substantial payment in one month, followed by months of minimal income. These peaks and troughs can make it difficult to determine whether you've crossed the GST threshold.
The ATO considers both your current turnover (past 12 months) and projected turnover (next 12 months). If either exceeds the threshold, you need to register for GST.
For example, if a filmmaker earns $65,000 in the past year but has signed contracts projecting $85,000 in the coming year, they must register for GST based on the projected turnover—even though their current turnover is below the threshold.
Creative collaborations can complicate GST turnover calculations. When multiple creatives work together, it's crucial to establish:
For instance, if two photographers form a temporary collaboration for a major project, they need to determine whether each is providing services individually (with separate GST obligations) or whether they're operating as a partnership (with combined GST turnover).
Even the most meticulous business owners can hit a wrong note when calculating GST turnover. Here are the most common mistakes to avoid:
Many businesses incorrectly include input-taxed supplies in their GST turnover calculations. For example, if you lease part of your studio as residential accommodation, this income should be excluded from your GST turnover.
Similarly, some businesses mistakenly exclude GST-free supplies (like certain educational services or exports). While these items aren't subject to GST, they still count toward your GST turnover.
Focusing solely on historical data while ignoring projected turnover is another common mistake. If you've signed contracts or have reasonable expectations of exceeding the threshold in the coming 12 months, you need to register for GST—even if your current turnover is below the threshold.
Complex business structures can lead to confusion about GST turnover. For GST groups (related businesses registered as a group), intra-group transactions are excluded from turnover calculations to prevent artificial inflation of figures. If your creative enterprise has multiple business entities, careful consideration of these rules is essential.
For sole traders especially, separating personal and business activities is crucial. Only business-related income should be included in your GST turnover calculations. For instance, if you're a musician who occasionally sells personal instruments, these personal sales shouldn't count toward your GST turnover.
Staying in rhythm with your GST obligations requires proactive management and systematic monitoring of your turnover. Here are key strategies:
Implement a monthly review of both your current and projected turnover. This gives you advance warning as you approach the threshold and allows you to prepare for registration if needed.
Maintain meticulous records of all income, clearly categorising which items count toward GST turnover and which are excluded. Cloud-based accounting software can automate much of this process, making compliance significantly easier.
If you exceed the threshold, you must register within 21 days. Registration applies from the date you exceed the threshold—not from when you submit your registration. This means you may need to backdate GST charges on invoices issued after crossing the threshold.
Even if your turnover is below the threshold, voluntary GST registration might be beneficial if:
For creative professionals working with larger corporate clients, voluntary registration can sometimes simplify invoicing and create a more professional appearance.
To illustrate how GST turnover works in practice, consider these examples from the creative sector:
Example 1: Session Musician
A session musician earns $5,500 per month playing on recordings and at live events, reaching an annual GST turnover of $66,000. While currently below the threshold, if they secure an additional regular gig pushing their projected annual income to $78,000, they must register for GST based on projected turnover.
Example 2: Graphic Design Studio
A small design studio has a current annual turnover of $80,000 from client work, plus $15,000 from subletting part of their office space as residential accommodation. Their GST turnover is $80,000 (excluding the input-taxed rental income), requiring GST registration.
Example 3: Production Company Partnership
Two filmmakers form a partnership with combined annual income of $110,000. As their partnership's GST turnover exceeds $75,000, they must register for GST. However, if they operated as separate sole traders each earning $55,000, neither would individually meet the threshold.
Understanding GST turnover is essential for creative professionals and businesses across Australia. It determines your GST registration requirements and forms the foundation of your tax compliance strategy. By correctly calculating your turnover, monitoring it regularly, and understanding the exclusions and special rules, you can ensure your business remains in harmony with ATO requirements.
For creative professionals with fluctuating income streams, this understanding is particularly crucial. The difference between compliance and non-compliance can significantly impact your financial position and business reputation.
Remember that GST turnover is about your gross income before expenses—not your profit—and includes both current and projected figures. By implementing proper systems to track your turnover and seeking professional advice when needed, you can focus your creative energy where it belongs: on your work and business growth.
Yes, businesses can voluntarily register for GST regardless of their turnover. This might be beneficial if you work primarily with GST-registered businesses who can claim input tax credits, or if you expect to exceed the threshold in the near future. However, it does create additional administrative requirements, including regular BAS lodgements.
GST turnover specifically excludes certain elements like GST collected from customers and input-taxed supplies (such as residential rent income). Accounting turnover typically represents total revenue without these exclusions. The distinction is crucial for determining GST registration requirements, as only GST turnover is relevant for threshold calculations.
If you exceed the threshold, even temporarily, you generally need to register for GST. However, the ATO may grant an exception if you can demonstrate the excess was due to an isolated transaction that's unlikely to be repeated. These exceptions are considered on a case-by-case basis, and professional advice is recommended in such situations.
Yes, income from exports and international clients counts toward your GST turnover, even though these supplies may be GST-free. This means overseas income can push you over the registration threshold, even though you won't charge GST on exports to overseas customers.
For businesses with branches or divisions, GST turnover is calculated at the legal entity level, not at the individual branch level. If your business is structured as a single legal entity with multiple divisions, the combined turnover determines your GST obligations. However, separate legal entities (even if related) generally have individual GST turnover calculations unless registered as a GST group.
Sign up to receive relevant advice for your business.
