GST on Australian Online Stores: How to Set It Up Correctly on Shopify or WooCommerce

An Australian online store must register for GST once its GST turnover reaches AUD 75,000 a year, then charge 10% GST on taxable sales and show customers prices that already include it. Some products, such as fresh fruit and vegetables and other basic food, are GST-free, so a store that sells a mix needs each product set to the right tax status. On Shopify or WooCommerce that comes down to a few settings: prices entered including tax, a GST-free status on the right products, the right treatment for delivery charges, and invoices that show your ABN.

This guide is general information, not tax advice. Confirm your situation with your accountant or the ATO. We use Oddies, the Australian fresh produce box store we built on Shopify, as the example of a store selling GST-free food.

When do you need to register for GST?

• When your GST turnover reaches AUD 75,000 in a 12-month period, or you expect it to (AUD 150,000 for non-profit organizations)
• You can register voluntarily below that, which lets you claim GST credits on business purchases
• Overseas businesses selling goods worth AUD 1,000 or less to Australian consumers must also register once their Australian sales reach AUD 75,000
• Once registered, you lodge a Business Activity Statement (BAS), usually every quarter

Show prices including GST

Australian consumer law requires the total price a customer pays to be shown, so prices to consumers should already include GST. Set your store so the price on the product page is the price at checkout, with the GST component shown on the receipt. Showing prices that add GST at checkout surprises customers and can mislead them.

GST-free products: food and mixed baskets

Basic food for human consumption is generally GST-free, including fresh fruit and vegetables, which is what Oddies sells. Prepared food, snacks, confectionery and drinks other than plain water are usually taxable. A store selling both needs each product marked correctly so the checkout charges GST only on the taxable items in a mixed basket.

What about delivery charges?

If you charge for delivery, GST on the delivery charge generally follows the goods: delivery of GST-free goods is generally GST-free, and delivery of taxable goods is taxable. For mixed orders, ask your accountant how to apportion the delivery charge, then set your store to match.

Tax invoices and receipts

• Business customers can ask for a tax invoice for sales over AUD 82.50 including GST, and you must provide it within 28 days of the request
• Show your business name, ABN, the date, what was sold, and the GST included, or that the item is GST-free
• Make your order confirmation emails and printable invoices carry these details, so customers rarely need to ask

How to set it up on Shopify

• In Settings, Taxes and duties: set up Australia, choose to include tax in your prices, and decide whether to charge tax on shipping rates
• On each GST-free product, untick the option to charge tax on that product
• Add your ABN and the GST wording to your order confirmation and invoice templates
• Place a test order with a mixed basket and check the GST on the receipt before you launch

How to set it up on WooCommerce

• In WooCommerce settings, enable taxes and choose to enter prices inclusive of tax
• Add a 10% GST rate for Australia, and use the zero rate tax class for GST-free products
• Choose how shipping is taxed, and add your ABN to invoices with an invoice plugin
• Test a mixed basket and check the tax on the order and the invoice